Power factor isn’t exactly a buzzword in the multifamily world—but it should be. It’s one of the most overlooked metrics that can have a big impact on your property’s energy costs, efficiency, and infrastructure performance. Understanding power factor, and more importantly, correcting it, can translate into measurable savings and long-term operational benefits.
What Is Power Factor? In simple terms, power factor is a measure of how efficiently electrical power is being used. A perfect power factor is 1.0, meaning all the power drawn from the grid is being used effectively. Anything below that indicates wasted energy. The lower the power factor, the more inefficient your system is—and the more likely you are to be charged extra by your utility provider.
Why It Matters for Multifamily Properties Multifamily buildings use a wide range of equipment and systems that can throw power factor off balance—from HVAC units and elevators to lighting and fitness center equipment. Over time, this imbalance leads to utility penalties, excessive strain on your electrical infrastructure, and higher overall energy consumption.
The Cost of Poor Power Factor Many utility providers issue charges when a property’s power factor drops below a certain level. These are known as reactive power or low power factor penalties. The worst part? Most property managers don’t even realize they’re being fined for inefficiency—they just see higher bills.
How Power Factor Correction Works Power factor correction typically involves installing capacitors or other electrical devices that balance the load and improve system efficiency. These devices help align the power being drawn with the power being used, reducing waste and minimizing or eliminating utility penalties.
The ROI of Power Factor Correction Correcting power factor can result in immediate and ongoing savings. Many multifamily operators see energy costs drop by 10–14% after optimization. In some cases, ROI is achieved within just a couple of months, especially when correction is part of a broader energy optimization strategy.
Where Bilancio Comes In Bilancio specializes in turnkey power factor correction for multifamily properties. Our solution installs quickly, with no disruption to residents, and provides ongoing data to support performance and savings. It’s a simple way to eliminate waste and protect your bottom line.
Power factor correction isn’t just a technical adjustment—it’s a smart financial move. By addressing inefficiencies you can’t see, you can unlock savings you didn’t know you were missing.