Basically the alternators are designed for 0.8 pF
only.Accrodingly the excitor voltage and current is
designed. You can not adjust the excitor voltage and
current to meet the power factor of load. This will
overload the alternator.

DG set is a power source. Capacitor bank is required for a
load to maintain the power factor i.e. reactive power. The
alternators are designed for 0.8 pf. if the load pf is lower
than this value, it will overload alternator. under such
conditions it is necessary to install a capacitor bank.

IN INDIA, DG DESIGN FOR 0.8 POWER FACTOR,THEN IN UR MIND A
QUESTION MAY ARRISE WHY .8 ONLY??
ANSWER IS THE LOAD IS ALLWAYS INDUCTIVE IN NATURE SO WE
USED 0.8 PF IN DG DEGINING AS A LAGGING PF.
NOW COME TO OUR ACTUAL QUESTION

CONSIDER 1000 KVA DG SET WHICH DELIVER 800 KW O/P POWER

BUT IF IMPROVE POWER FACTOR FROM .8 TO 1 PF THEN
OBEIOUSLY POWER DELIVER INCREGES FROM 800 TO 1000KW

P= V*I*COS $ WE KNOW THAT PF IS 1
LOAD CURRENT IS ALSO SAME FOR
LOAD
HERE POWER INCREASE DIRECTLY EFFECT THE VOLTAGE LEVEL
IF THE VOLTAGE LEVEL GOES BEYOND THE LIMIT IT WILL TRIP
THE AVR SYSTEM OF DG & DG WILL STOP RUNNING

IF WE USE CAPACITOR BANK THEN VOLTAGE LEVEL INCREASE
BEYOND THE LIMIT..SO WE R NOT USEING CAPACITOR BANK.

Increasing p.f shall automatically enhance the Kw demand
then its designed value and the alternator shall not be
able to cater this additional Kw and shall trip due to over
current. Hence it is not recommended to install the
capacitors accross the DG set to increase its p.f more then
its designed value.

DG set supplies necessary current to load. Its (internal)
Power Factor is governed by its design. DG sets like
transformers are rated in KVA i.e. KVxI.
Whatever be the load power factor, a DG set's internal power
factor will be governed by its design.
If a reactive load such as inductor or capacitor of
equivalent capacity (LOAD KVA = DG set's KVA)) is connected
across a DG set's terminals, the power factor measured at
these terminals will be nearly 0. However in this situation
also DG set's internal PF wikk be its designed PF.
Power factor is a parameter with respect to its measurement
location.
If load supplied by a DG set consists of large number of low
power factor loads which eats up only very small portion of
its total capacity and the balance load is taken by a high
power factor load, then the power factor at DG set's
terminal will still be high. But the DG set's internal power
factor will still be governed by its design.

dr frnds, what Sudhir has said is right.. dg sets are built
with AVR(automatic voltage regulators) as it controlls the
voltage & power factor according to the load there will be
no requirement of seperate capacitor bank.

It is possible to switch on high speed microprocessor
based capacitor bank on running d g set.But with A P F C
ie. contactor based can be used with time delay So as it
will result in zero voltage available on terminal of the
capacitor.( during switching of said capacitor bank on
running generator).However one must think of no load
condition of the d g set so as to use sensitive steps for
capacitor in the circuit.It is observed most of the load
in IT sector having non linear loads ,hence result in
impure power as well as low powerfactor leads to additional
loads.Capacitor used to filter harmonic current and change
of the power factor need to classified before application
the bank.