If the voltage and current signals in an electrical network are not in phase, the out-of-phase component gives rise to reactive power flow. Reactive power cannot be used, but still causes losses in an electrical network, hence its flows should be minimised. Induction generators consume reactive power, and the network operator may wish to be compensated for the losses this causes. Synchronous generators can be made to consume or produce reactive power as desired, which may be of use to the network operator.

Reactive power is an imaginary component of the apparent power. It is usually expressed in kilo-vars (kVAr) or mega-vars (MVAr). Reactive power is the portion of electricity that establishes and sustains the electric and magnetic fields of alternating-current equipment.

Reactive power must be supplied to most types of magnetic equipment, such as motors and transformers, and causes reactive losses on transmission facilities. Reactive power is provided by generators, synchronous condensers or electrostatic equipment such as capacitors and directly influences the electric system voltage. The reactive power is the imaginary part of the complex product of voltage and current.