Power Factor Correction is the ratio between the kW and the kVA drawn by an electrical load where the kW is the actual load power and the kVA is the apparent load power
For a machine to perform work it must be supplied with energy. In the case of electric motors, more electricity must be supplied than actually appears as useful work at the motor shaft. A certain amount of electricity is required just to maintain the necessary magnetic field and does not produce any useful work. This component is known as reactive power.
The reactive power used by electrical equipment like transformers, electric motors, welding units, server banks, lighting systems and static converters adds additional load to generators, transmission lines, transformers, switchgear and cables.