Understanding Reactive Power: Invisible Costs on Your Electricity Bill

Find out how reactive power causes invisible costs on your electricity bill and how companies can reduce them through targeted measures such as the ESO® system.
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Kevin Grün
September 23, 2024

In Times of Rising Energy Costs, Companies Are Constantly Looking for Ways to Lower Their Electricity Bills and Increase Energy Efficiency. An often overlooked but no less important aspect of this is reactive power. Although it is “invisible,” it can lead to noticeable financial burdens. In this article, we explain exactly what reactive power is, how it is generated, what hidden costs are associated with it and how you can optimize these costs through targeted measures, such as using the ESO® system.

What is reactive power?

Electricity that you purchase from your energy supplier consists of two components: active power and reactive power. Active power (measured in kilowatts, kW) is the electrical energy that is actually converted into work — for example to operate machines, lighting, or other electrical devices. Reactive power (measured in kilovolt-ampere reactive, kVAr), on the other hand, is the part of electrical energy that is necessary to operate electrical devices such as transformers, electric motors or fluorescent lamps, but does not do any useful work.

To illustrate this, electric motors and transformers generate magnetic fields that are necessary to make them work. The energy that is expended for this is called reactive power. This energy flows back and forth between the grid and the consumer without becoming “visible” in the form of light or movement. However, it remains an unavoidable part of the electrical system, particularly in companies with a lot of inductive loads such as machines, cooling systems, pumps or conveyors.

How is reactive power generated?

To understand how reactive power is produced, you have to look at the way electrical devices work. With inductive consumers — such as electric motors, compressors or transformers — energy is not converted directly into mechanical work, but part of it is required to build up the magnetic field. This energy is known as reactive power. The phase shift between current and voltage means that the electrical energy can only be used partially for actual work; the rest remains in the system in the form of reactive power.

Reactive power is therefore an unavoidable part of the energy flow in every company that operates inductive consumers. But although it is not physically visible, it still causes indirect costs that add up over time.

How does reactive power affect your electricity bill?

Most companies do not immediately notice the effects of reactive power on their electricity bills, as many network operators only directly charge the costs of reactive power if it exceeds a certain threshold.

Even if reactive power does not cause any immediate additional costs, it leads to inefficient use of the power grid and thus to hidden costs. These efficiency losses occur because reactive power puts a greater load on the power grid and the lines have to transport more electricity than would actually be necessary for effective power. These results in:

- Heating the pipes: More current flow through the lines due to the oscillation of reactive current generates additional heat, which leads to energy losses.

- Higher network losses: These losses, which are often “hidden” in operating costs, drive up the costs of purchasing electricity.

- Reduced lifetime of equipment: Inductive devices that are exposed to high reactive power are subject to higher wear, resulting in more frequent maintenance and repair costs.

Which companies are most affected?

Companies that rely heavily on machines with inductive loads are most affected by the effects of reactive power. Typical industries and companies that are frequently confronted with this issue include:

- Manufacturing companies: Machine parks, production plants, conveyor belts, cooling systems.

- Wash Parks and Gas Stations: Car washes, pumps and compressors, which are necessary to operate the washing systems and tank systems.

- Agriculture: Pumps, Motors for Biogas Plants and Cooling Systems.

These companies often have high reactive power as they operate numerous devices that rely on electromagnetic fields.

How can you reduce reactive power and other grid disruptions?

Fortunately, there are effective measures to reduce reactive power and thus increase energy efficiency. One of the most advanced solutions on the market is ESO® system (Electronic power optimization). The ESO® system is specialized in minimizing reactive power and optimising the performance of your power grid. It also offers other benefits that are particularly valuable for companies with high power requirements:

- Reduction of reactive power: The ESO® system reduces reactive power through targeted compensation and ensures that less energy remains unused.

- Smoothing out harmonics: Harmonics are unwanted frequencies in the power grid caused by nonlinear consumers such as frequency inverters, computers and LED lighting. These distortions affect the efficiency of your systems and can cause damage. The ESO® system helps smooth out these harmonics to ensure a more consistent power supply.

- Filtering of interference pulses: Interference pulses, i.e. known as transients, are caused by switching processes or lightning strikes and can damage sensitive electronic devices or shorten their lifespan. The ESO® system acts like a filter and reduces these interference pulses, which means that your systems are better protected.

- Less energy loss: By minimizing reactive power and smoothing out harmonics, line losses in the power grid are reduced, resulting in a noticeable reduction in energy costs.

- Extended lifetime of devices: By reducing reactive power, filtering interference and improving network quality, your machines and systems can operate more gently, resulting in a longer service life.

- CO₂ reduction: Lower energy consumption also means lower CO₂ emissions, which helps to achieve your company's climate goals.

The ESO® system is modular and decentralized, which allows flexible adaptation to the individual requirements of your company. It uses intelligent software and precise measurement technology to monitor and adjust reactive power, harmonics and interference pulses in real time.

Conclusion: Make invisible costs visible and save in the long term

Reactive power may seem complicated and invisible at first glance, but its impact on your company's energy costs and efficiency is real. Optimizing reactive power, smoothing out harmonics and filtering interference pulses can not only help to reduce operating costs, but also extend the life of your systems and support compliance with legal requirements, such as the Energy Efficiency Act.

Would you like to learn more about reducing reactive power, smoothing out harmonics and protecting against interference pulses? Contact us today and get advice from our experts!

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