Generally, the parallel capacitor banks are static source of reactive energy which shall be produced by power system as an alternative for reactive power generation in power plant via large power generators. The best location of this compensation system in the point of technical-economical view can be obtained regarding system configuration and power system study.
The power factor correction capacitors can be installed at high voltage bus, distribution, or at the load. The power factor correction capacitors can be installed for a group of loads, at the branch location, or for a local load. The benefits due to the power factor correction for the utility are release in system generation capacity, savings in transformer capacity, reduction in line loss, and improved voltage profile. The benefits due to power factor correction to the customer are reduced rate associated with power factor improvement, reduced loss causing lower peak demand, reduced energy consumption, and increased short-circuit rating for the system.
An example of local capacitor bank application for the power factor correction is shown in below Figure. In this scheme, the individual loads are provided with separate capacitor banks.
This type of reactive compensation is mainly suitable for industrial loads. The localized power factor correction can be expensive.
Shunt capacitors provide reactive power locally, resulting in reduced maximum kVA demand, improved voltage profile, reduced line/feeder losses, and decreased payments for the energy. Maximum benefit can be obtained by installing the shunt capacitors at the load. This is not always practical due to the size of the load, distribution of the load, and voltage level.
Depending on the need, the capacitor banks are installed at extra-high voltage (above 230 kV), high voltage (66–145 kV), and feeders at 13.8 and 33 kV. In industrial and distribution systems, capacitor banks are installed at 4.16 kV.
In distribution systems, the voltage at the load end tends to get lower due to the lack of reactive power. In such cases, local VAR support is offered using shunt capacitors. In the case of long transmission lines, the reactive power available at the end of the line during peak load conditions is small and hence needs to be supplied using shunt capacitors. The advantage of providing local reactive power can be demonstrated by an example.
Consider a 460 V, three-phase radial system without and with shunt capacitors as shown in below Figure. The load at the end of the radial feeder is (40+j 53.4) kVA. It can be seen that the load requires significant reactive power, which can be supplied using shunt capacitors as illustrated in Figure. Let the reactive power supplied by the shunt capacitors be 42.1 kVAR. Now compare the load flows from the source without and with shunt capacitors as listed in Table. From the table it can be seen that the reactive power drawn from the supply is substantially less, and the kVA and the current flows are less. The power factor at the load is improved.