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Power factor is a relationship between working (active) Power and Total Power Consumed (Apparent Power).
Essentially, the power factor is measurement of how effectively electricity power is being used. The higher the Power Factor, the more effectively the electricity power is being used and vise versa.

A Distribution System's operating power is composed of two parts: Active (working power) and Reactive (non-working) Magnetizing Power. The active Power performs the useful work..... The Reactive Power does not, as its only function is to develop Magnetic Fields required by inductive devices. General Power Factor decreases (ø increase) with increased inductive load. Therefore, when more inductive reactive power is needed, more apparent power is also needed. This geometric relationship of apparent power to Active Power is traditionally expressed by the right triangle relationship of : Cosø=P.F=kw/kva

 
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