The demand of active power is expressing Kilo Watt (kw) or mega watt (mw). This power should be supplied from electrical generating station. All the arrangements in electrical pomes system are done to meet up this basic requirement. Although in alternating power system, reactive power always comes in to picture. This reactive power is expressed in Kilo VAR or Mega VAR.

The demand of this reactive power is mainly originated from inductive load connected to the system. These inductive loads are generally electromagnetic circuit of electric motors, electrical transformers, inductance of transmission and distribution networks, induction furnaces, fluorescent lightings etc. This reactive power should be properly compensated otherwise, the ratio of actual power consumed by the load, to the total power i.e. vector sum of active and reactive power, of the system becomes quite less.