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Capacitors are sometimes connected in parallel to inductive loads to improve the power factor, raising the voltage of the source AC.

Power factor is the ratio of apparent power over true power. It is 1, if the load is purely resistive, such as in a toaster, but it is less than 1 if the load is reactive, such as in a motor. This is because current is not in phase with voltage in that case. Inductive loads cause the current to lag voltage, and capacitive loads cause the current to lead voltage. Placing capacitors across an inductive load tends to compensate for the lagging power factor.

Specifically, power factor is the cosine of the phase angle between voltage and current. In an ideal situation, with perfect sources, conductors, and reactive loads, the phase angle would be plus (capacitive) or minus (inductive) 90 degrees, and the power factor would be zero. This means that a conventional watt meter would register zero but, in reality, energy is still being supplied, and that has to be accounted for.

In practical terms, since conductors have impedance, a poor power factor degrades voltage so, adding capacitors raises voltage.

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