POOR TRANSMISSION EFFICIENCY
Losses in all power system elements from the power station generator to the utilization devices increase due to reactive power drawn by the loads, thereby reducing transmission efficiency.
POOR VOLTAGE REGULATION
Due to the reactive power flow in the lines, the voltage drop in the lines increases due to which low voltage exists at the bus near the load and makes voltage regulation poor.
LOW POWER FACTOR
The operating power factor reduces due to reactive power flow in transmission lines.
NEED OF LARGE SIZED CONDUCTOR
The low power factor due to reactive power flow in line conductors necessitates large sized conductor to transmit same power when compared to the conductor operating at high power factor.
INCREASE IN KVA RATING OF THE SYSTEM EQUIPMENT
The reactive power in the lines directly affects KVA rating of the system equipment carrying the reactive power and hence affects the size and cost of the equipment directly.
REDUCTION IN THE HANDLING CAPACITY OF ALL SYSTEM ELEMENTS
Reactive component of the current prevents the full utilization of the installed capacity of all system elements and hence reduces their power transfer capability.