Power factor is the ratio between the effective power and the apparent power of a network. Apparent power is equal to the product of voltage and current, and effective power represents the real power. While effective power represents the real energy consumption of a network, apparent power represents the total power consumption of a network. When the power factor is low, energy loss increases and the electrical network becomes less efficient. Compensation panels are designed to solve this problem. These panels contain capacitors, inductors, and other devices. Capacitors are used to correct low power factors, while inductors are used to correct high power factors. In this way, the power factor in networks is corrected and energy loss is reduced.