Case study · Agri-processing
A 0.99 power factor, and what it was really worth at I&J.
In July 2026 the Augos platform flagged I&J Aquaculture's abalone farm in Gansbaai at a power factor of 0.99 and an estimated R10,019 a month. Most of that estimate was reactive energy, which the Overstrand tariff only bills above 30% of standard-period kWh. Correcting the tariff rule put the real power factor cost at R19,923 over twelve months. All six PFC panels on the farm were surveyed and a capacitor sizing error was caught before it was fitted.
- The alert estimated R10,019 a month at a 0.99 power factor, mostly from reactive energy.
- The Overstrand tariff only bills reactive energy above 30% of standard-period kWh, and the farm stays under it.
- With the tariff rule corrected, the real power factor cost was R19,923 over twelve months, all of it demand.
- Six PFC panels were surveyed and a wrongly listed capacitor step was caught before anything was fitted.
By Oliver Nesbitt, Sales & Client Relations, Augos Energy
A lead that didn't look like a lead
On 11 July 2026 the platform flagged I&J Aquaculture's abalone farm in Gansbaai. The power factor at maximum demand was 0.99. The alert said correcting to 1.0 could save R10,019 a month: R913 from demand and R9,106 from reactive energy.
My first reaction was: 0.99? That's nearly perfect. But the farm is a client we speak to all the time, so I used the alert to open the conversation. I sent the engineering manager our power factor report, with twelve months of power factor, demand and tariff rates.
The client caught what we'd missed
He replied the same morning. Good report, he said, but he didn't think they were charged for reactive energy at all.
He was right. I went back to the Overstrand tariff and found it on page 15: reactive energy is only billed above 30% of standard-period kWh, and the farm stays under that. Our estimate had been adding a charge that never appears on the invoice.
The honest move was to tell him and fix it. We corrected the reactive energy rule on 31 July and recalculated his historical bills to zero reactive charge. While we were in there, we found the platform was still using peak, standard and off-peak times from before July 2025, so we corrected those on 4 August. When reactive charges reappeared on the estimate in early September, the rule was redeployed within a day.
With the tariff rule matching how Overstrand bills, the real power factor cost over the twelve months to September 2026 was R19,923, all of it demand. The alert had implied about R120,000 a year. The client's bill verification now checks like for like against the municipal invoice.
Six panels, one sizing query
The farm doesn't have one PFC panel. It has six, one at each mini-substation, and a high power factor at the main switch can hide a weak panel out on site. The engineering manager wanted a health check anyway, so we surveyed all six on 7 August, testing every capacitor, contactor and fuse.
Going through the reports, I picked up that Substation 3, step 3 was listed as a 10 kVAr capacitor while the recommendation said to fit 25 kVAr. The fuse and contactor were rated for 25 kVAr, and the installer confirmed a 10 or 12.5 kVAr unit would also work. It's a small thing, but it's exactly the kind of mistake that gets fitted if nobody questions it.
New solar inverters are going in at Substations 3 and 5. Inverters can bring harmonics, which damage standard capacitors, so the surveys also checked whether those panels have space for detuned reactors. Power quality logging will confirm whether they're needed.
What the data showed
| Month | Power factor at max demand | Avoidable demand cost |
|---|---|---|
| February 2026 | 0.972 | R3,947 |
| July 2026 (alert month) | 0.973 | R4,688 |
| August 2026 | 0.995 | R878 |
| September 2026 | 0.994 | R1,059 |
In nine of the twelve months to September 2026, the avoidable demand cost was between R857 and R1,444. The two dips to 0.97 were the months that cost real money. We quoted for the repairs the surveys found, and I&J's own team carried them out. Power factor read 0.995 in August and 0.993 for October to date.
What I'd tell any plant engineer
Know exactly how your tariff charges you for power factor before you spend on correction. Then make sure whoever monitors your site calculates your bill the same way the municipality does. And don't let a good power factor at the main switch stop you doing the annual survey: the problem is often in one panel out on site.
I'm fine that we didn't do the repairs. The relationship is stronger than when we started, because we told the client our own number was wrong.
Figures from the Augos Power Factor and Demand report for the farm's billing point, October 2025 to October 2026, recalculated on the corrected Overstrand tariff. The 30% reactive energy threshold is from the Overstrand tariff document, page 15.
In this story
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The report behind the alert and the twelve-month cost in this story.
Explore ›PFC that stopped working at Much Asphalt
A plant where correction worked for 17 months, then slipped.
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Questions
Why was a site with a 0.99 power factor flagged at all?
The farm is large, around 1,700 kVA at peak, so a small gap in kVA is still worth money. The estimate also assumed reactive energy was billed in full, which on this tariff it is not.
Why was the alert higher than the real cost?
The alert works out the bill at a power factor of 1.0, which is a ceiling, and it included reactive energy. Overstrand only bills reactive energy above 30% of standard-period kWh. Once the platform matched that rule, the real cost was R19,923 over twelve months, all from demand.
Does a 0.99 power factor mean there is nothing to fix?
Not always. The farm dipped to 0.97 in February and July 2026, and those two months cost R3,947 and R4,688. With six panels on site, a good reading at the main switch can hide one weak panel.
How are you charged for poor power factor in South Africa?
It depends on the tariff. On this farm's Overstrand tariff, poor power factor raises billed demand, charged per kVA, and reactive energy is only charged above a threshold. Check your own tariff before you put a number on it.
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