Abstract
Low power factors have significant detrimental effects on power networks, particularly at the distribution level. They increase network losses, adversely affect voltage profiles, and are a cause of overheating machines and equipment. Various mechanisms have been employed to improve low power factors, including technical solutions, regulations, and financial penalties and incentives. In this paper, a multiplier-based approach for low power factor penalties using payback periods optimized with genetic algorithms is proposed and designed, and a general algorithm derived for utility applications. Inherent to the proposed method are the financial and technical concerns of both electricity utility and customer. A general equation for the multiplier-based approach is derived from simulation results in order to avoid complex optimization algorithms. Using sensitivity analysis to eliminate the wide difference in adopted power factor regulations around the world, the study highlights factors that have to be considered when designing penalties for low power factors.