Abstract
The negative impact of low power factors on power networks is significant and profound particularly at the distribution level. Inadequate voltage profiles, increased network losses, and the overheating of machines and equipment are some of the well-known side effects. Regulations, financial penalties and incentives, and technical solutions have all been used to improve low power factor levels. In this paper, studies and comparisons among several low power factor penalty schemes are considered leading to the most convenient method to be applied in practice. The study helps with highlighting the factors that highly to be considered when designing such penalties in order to eliminate the wide difference in the adopted low power factor regulations among utilities. The use of excessive reactive power/energy tariff to be the penalty for low power factor customers seems to be the favorable choice for utilities due to its consistency and reliability. This study forms the bases on which the new applied low power factor financial penalties in Saudi Arabia are designed.