In a region where marketing of electricity is being practiced, the supply of electrical energy becomes highly competitive between the supply utilities. Private distribution companies are dedicated to maintaining the quality of supply at an elevated level to consumers, although their primary aim was to run a profitable and successful business through compensation plans to the clients. This book focus on improvement of power factor on inductive loads in machine tools plant. Since most of the electrical loads are inductive in nature and to provide reduction in distribution losses and the electricity bill charges, a form of power factor correction device is employed, usually in the form of capacitors, which draws leading reactive current to neutralize as much of the lagging reactive component of load current as possible. To improve the power factor in machine tools industries, it is required to install capacitors of appropriates ratings as near to the load as possible. This paper presents a case of an induction machine in a factory having a power factor of 0.75 and has capacity of improving its power factor to 0.9 by connecting suitable capacitors in parallel with the inductions motors.