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Why Transformers are Rated in kVA, Not in kW?

Transformer rating is expressed in kVA, not in kW. Rating of a transformer or any electrical machine reflects its load carrying capability without overheating. Temperature rise (major threat to insulation) arises due to internal loss within the machine. 

There are two type of losses in a transformer;

  1. Copper Losses
  2. Iron Losses or Core Losses or  Insulation Losses

Copper losses ( I²R) are variable losses which depends on Current passing through transformer windings while Iron Losses or Core Losses or  Insulation Losses depends on Voltage.

So the transformer is designed for rated voltage (iron loss) and rated current (copper loss). We can't predict the power factor while designing the machine, because power factor depends upon the load which varies time to time.

When a manufacturer makes a transformer, UPS etc, they have no idea of the type of load that will be used & consequently they can only rate the device according to its maximum current output that the conductors can safely carry (at unity Power Factor) & the insulation rating of the conductors (voltage & temperature). 

That’s why the Transformer Rating may be expressed in kVA, Not in kW.