In recent years, the power quality of the ac system has become great concern due to the rapidly increased numbers of electronic equipment, power electronics and high voltage power system. Most of the commercial and industrial installation in the country has large electrical loads which are severally inductive in nature causing lagging power factor which gives heavy penalties to consumer by electricity board. This situation is taken care by PFC. PFC is the capacity of absorbing the reactive power produced by a load. In case of fixed loads, this can be done manually by switching of capacitors, however in case of rapidly varying and scattered loads it becomes difficult to maintain a high power factor by manually switching on/off the capacitors in proportion to variation of load within an installation. This drawback is overcome by using an Automatic Power Factor Correction panel. This book focuses on the design and implementation of power factor correction using PIC micro-controller chip, determine the power factor of the loaded power system, and generate proper action to calculate and to add sufficient capacitor.