Your Utility Is Charging You
For Wasted Energy.
Power Factor Correction Stops It.
Most Houston businesses with motors, compressors, HVAC, or industrial equipment are paying demand charge penalties on their electric bill every single month — and don’t know it. Texas Direct Solar installs power factor correction systems that eliminate those penalties and reduce your total energy cost permanently.
Is your business affected? If your monthly electric bill includes a line item for “demand charges,” “reactive demand,” or “kVAR charges” — and you operate motors, compressors, HVAC systems, welding equipment, or any inductive load — you are almost certainly paying a power factor penalty. A free audit confirms it in under an hour.
Your Utility Delivers Two Kinds of Power.
You Only Pay for One — But Get Billed for Both.
Electric power comes in two forms: real power (kW) — the power that actually does work — and reactive power (kVAR) — the power that motors, transformers, and other inductive loads need to operate but don’t convert into useful work.
Power factor is the ratio between the two. A perfect power factor of 1.0 means all delivered power is doing useful work. A power factor of 0.70 means 30% of the power your utility delivers is wasted as reactive power — and CenterPoint charges you for it through demand penalties.
Your equipment creates reactive power demand
Motors, compressors, HVAC systems, welding equipment, and variable frequency drives all draw reactive power to create their magnetic fields.
Your utility measures and charges for it
CenterPoint’s commercial rate schedules include demand charges based on your peak kVA draw — not just kW. Low power factor inflates your kVA and your bill.
Capacitor banks supply reactive power locally
A power factor correction system installs capacitor banks at your panel or equipment level, supplying reactive power on-site so your utility doesn’t have to — eliminating the penalty.
Power Factor Meter
Most utilities including CenterPoint target a minimum power factor of 0.90–0.95 for commercial accounts. Falling below this threshold triggers automatic demand penalty surcharges on your monthly bill.
Any Houston Business Running
Inductive Equipment Is a Candidate.
If your facility operates any of the following types of equipment and your monthly electric bill exceeds $2,000/month, a power factor audit is worth scheduling.
Manufacturing & Industrial
CNC machines, conveyor motors, compressors, welding equipment, and hydraulic systems are among the highest reactive power consumers.
High PriorityRetail & Restaurant
Large HVAC systems, walk-in cooler compressors, commercial kitchen equipment, and lighting ballasts all contribute to poor power factor.
Common IssueOffice & Medical Buildings
Large multi-tenant buildings with centralized HVAC, elevator motors, and data center UPS systems often carry significant reactive loads.
Common IssueWarehouses & Distribution
Dock levelers, conveyor systems, lighting systems with magnetic ballasts, and large HVAC units all reduce power factor in warehouse facilities.
High PriorityChurches & Nonprofits
Large sanctuaries with significant HVAC, stage lighting rigs, and audio/visual equipment can have surprisingly poor power factor.
Often OverlookedHotels & Multi-Family
Elevator motors, pool pumps, laundry equipment, and centralized HVAC across multiple units create reactive power demand at scale.
Good CandidateCapacitor Bank Systems — Designed,
Supplied, and Installed by TDS.
We don’t subcontract power factor correction. Our licensed electrical team (#34757) handles the full scope — load analysis, system design, equipment supply, installation, and post-install verification.
Fixed Capacitor Banks Most Common
Installed at the main service entrance or sub-panel level. Best for facilities with consistent, predictable reactive loads. Low maintenance, long lifespan (20+ years), immediate ROI.
- ✓Installed at main service panel or MDP
- ✓Sizes from 25 kVAR to 600+ kVAR
- ✓Automatic switching options available
- ✓UL-listed equipment, fully permitted
- ✓Post-install power factor verification
- ✓Ideal for: warehouses, manufacturing, retail
Automatic Power Factor Controllers Variable Loads
For facilities with variable or intermittent reactive loads — automatically switches capacitor stages in and out to maintain target power factor at all times.
- ✓Real-time power factor monitoring
- ✓Automatic stage switching (4–12 steps)
- ✓Integrated harmonic filtering available
- ✓Remote monitoring capability
- ✓Ideal for: manufacturers, mixed-use facilities
- ✓Prevents over-correction (leading PF)
Harmonic distortion note: Facilities with variable frequency drives (VFDs), switching power supplies, or non-linear loads may require harmonic filtering in addition to capacitor banks. We assess harmonic content during your audit and size the system accordingly — standard capacitors can actually amplify harmonics in high-distortion environments without proper filtering.
What Power Factor Correction Actually
Saves a Houston Business
The numbers below are representative of a mid-size Houston manufacturer on a CenterPoint General Service demand rate. Your actual savings will vary — which is exactly why we start with a free audit.
| Item | Before Correction | After Correction | Annual Impact |
|---|---|---|---|
| Average Power Factor | 0.68 | 0.96 | — |
| Monthly Demand Charge | $4,200 | $3,150 | −$12,600/yr |
| Reactive Demand Penalty | $680/mo | $0 | −$8,160/yr |
| Distribution Losses | High | Reduced ~3% | −$1,800/yr |
| Total Annual Savings | — | $22,560/yr | |
| System Installation Cost | ~$18,000–$28,000 | One-time | |
| Simple Payback Period | — | ~14–18 months | |
* Example based on 200 kVAR system at a 150,000 sq ft manufacturing facility on CenterPoint General Service – Large Power rate. Actual results vary by facility, load profile, and rate schedule. A free audit determines your specific savings potential.
From Audit to Savings in 4 Steps
Free Power Factor Audit
We review 12 months of utility bills and conduct an on-site load assessment. No cost, no obligation.
System Design & Proposal
We size the capacitor bank system for your specific load profile and calculate your projected ROI.
Licensed Installation
Our licensed electrical crew (#34757) installs and commissions the system. Fully permitted, inspected, and warranted.
Verification & Monitoring
Post-install power factor verification confirms target PF achieved. Monitoring options available for ongoing performance tracking.
Power Factor Correction Works Even
Better Combined With Solar.
TDS is the only Houston installer that can address your energy costs from every angle simultaneously — generation, rate, demand, and power quality. When you stack these services, the savings compound.
PFC + Commercial Solar
Power factor correction reduces your demand charges first — which lowers the baseline your solar system needs to offset. This means you can right-size your solar system smaller and still achieve the same net bill reduction. Lower system cost, same savings.
PFC + Demand Response
Grid services programs like Voltus pay you to curtail load during peak demand events. A facility with corrected power factor runs more efficiently during curtailment periods and qualifies for higher demand response payments.
PFC + Commercial Rate Optimization
We broker commercial electricity rates and negotiate TDU delivery charges alongside installing PFC. Correcting power factor may qualify your facility for a lower rate tier — further compounding your savings.
Full Energy Audit
Let us assess all four simultaneously — generation (solar), rate (brokerage), demand (PFC), and grid services (demand response). Our free Commercial Energy Audit covers all of it and delivers a single integrated savings proposal.
Common Questions About
Power Factor Correction
Find Out If You’re Paying
a Power Factor Penalty
Free on-site audit. We review your utility bills, measure your load profile, and show you exactly what you’re losing — and what correction would save you annually.
Schedule My Free Audit → ✆ 832-905-8974