**Higher current is required by the equipment, due to which the economic cost of the equipment is increased**. At low power factor, the current is high which gives rise to high copper losses in the system and therefore the efficiency of the system is reduced.

In Points

- Cross section of conductor increases: As power factor reduces current increases, cross section of conductor increases. Hence its cost increases
- Weight of conductor increases: As cross section of conductor increases its weight increases.
- Design of supporting structure: As weight of conductor increases design of supporting structure becomes heavier, so its cost increases.
- Energy bill (KWH) increases: So at low P.F. energy consumption increases so energy bill increases.So at low P.F. KVA demand (M.D. charges) increases so energy bill increases.
- Handling Capacity of equipment reduces: Handling capacity (KW) of each equipment such as Alternator, transformer reduces as power factor reduces.
- Design of supporting structure: As weight of conductor increases design of supporting structure becomes heavier, so its cost increases.
- Copper losses increases: As power factor reduces current increases. So copper losses increases. As an effect efficiency reduces.
- Voltage drop increases: As P.F. reduces current increases. Therefore voltage drop increases, so regulation becomes poor.
- High KVA rating of equipment required: As power factor decreases KVA rating of all equipments increases, so that its cost increases.