Three different ways exist to measure power; active power, reactive power, and apparent power.  Active power is measured in watts (W or true power), reactive power is measured in volt-amperes reactive (VAR) and apparent power is measured in volt-amperes (VA).

Active power (W) or true power = useful work.  Watts can be determined by multiplying voltage and current.  Utility charges are based on watts.  This equates to the amount of power it takes to do a given amount of work.  Due to the amount of reactive power in a system, one might need to consume more current which means the same amount of work is accomplished by drawing more watts.

Reactive power (VAR) = necessary overhead.  Reactive power energizes the magnetic fields of inductors (coils) and charges capacitors; therefore, motors, transformers, and capacitors all require VARs.  Reactive power cannot be avoided in overhead ac power circuits.

Apparent power (VA) = system capacity.  VA can be defined as a measure of system capacity.  The system VA must have the ability to supply the VARS and watts required.  Transformers are not sized in watts; they are sized in VA or kVA.

Power factor (PF) = W/VA.  Because watts measure useful power whereas VA measures supplied power, watts/VA = useful power/supplied power.