A central automatic capacitor bank is preferred to individual compensation when the load
Answer: C
Correct answer: varies widely, so the correction must be switched in steps
An automatic bank measures the power factor continuously and switches stages in and out to follow it, which is what a varying load needs - fixed capacitors sized for the peak would overcompensate at light load and drive the power factor leading, which is penalised on many tariffs and can cause overvoltage. Individual compensation at the machine suits a single large motor or a long cable run, since it relieves the cable as well.
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