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Actually, electric utilities object to a lagging power factor, but it does not really matter if its leading (capacitive) or lagging (inductive). The problem is that true vs apparent is less than unity - that's the definition of power factor - and this causes the indicated power (KW) to be less than the actual power (KVA) by a trigonometric relationship between KW and KVAR (kilo volt-amperes reactive). That energy is still required to be provided, and this requires facilities in excess of what is indicated by the power meter.
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