The addition of power factor correction will reduce tha current drawn from the supply if the load is inductive in nature. This will not directly reduce the KW consumed by the load, but as has been correctly stated above, will reduce the kw losses in the supply system. Correcting the power factor will allow a greater utilization of the supply distribution system. For example, a 500KVA transformer can supply 500KW at a power factor of 1.0, but 400kw at a power factor of 0.8
In a typical installation where you do not own your own power supply reticulation transformers, do not expect to see a significant reduction in KWHr if any. There are a number of suppliers out ther promising ten per cent savings etc, but this can not be justified purely on the reduction on KWHr.
In order to minimise the cost of investment in plant, many supply authorities have power factor incentives to encourage the correction of poor power factor and load curves. It is common to apply a KVA Maximum demand tarif in addition to the KWHr charge. This will certainly be affected by a poor power factor. Another method, is to charge a penalty for poor power factor and there are many ways of doing this.
I believe that it is fair to say however, that domestic and very small commercial users only pay on KWHr and will achieve nothing by the use of power factor correction. Some of these suppliers are even getting to the home owner and suggesting that they will save by the use of power factor correction!!
The addition of power factor correction, can cause major problems on the supply, especially if the supply is very weak and inductive. (Long overhead lines in a rural environment) The capacitance combines with the inductance of the supply to form a resonant circuit. If the loading on the supply is low, then the 'Q' can be high and switching transients can excite the resonant circuit resulting in very high ringing voltages. You never get anything for nothing!!.
Best regards, Mark Empson