The power of electrical equipment is rated in Watt (W), but some equipment, such as electric motors, beyond active power, in Watt (W), also require Reactive Power, in reactive Volt-Ampere (VAr).
The conjugate effect of these two powers its called "Apparent Power", measured in Volt-Ampere (VA). The relation between these two is given by a ratio called "Power Factor".
Household customers meters mesure "Apparent Power" and, therefore, the contracted power is measured in kVA (1 kVA = 1 000 VA).
In order to choose the contracted power, we can use directly the power indicated in the equipments (generally in Watt).
The power factor is not measured for household customers and small businesses, and therefore, reactive energy is not billed separately. Only non-households
customers explicitly pay reactive energy .