Power factor of an AC electric power system is defined as the ratio of the real power (kW) to the apparent power (kVA) and is a number between 0 and 1.

Power factor correction board or capacitor bank is equipment used to improved power factor. Power factor correction board consists of a number of capacitors, contactors and a regulator.

Power factor regulator measures power factor in an electrical network using CT (Current transformer) for each phase. Depending on the load and power factor of the network, the power factor regulator will switch the necessary blocks of capacitors in steps to make sure the power factor stays above a selected values demanded by the energy supplier. In Malaysia, the power factor required by the energy supplier is 0.85.