Power factor is the ratio between Real Power (the power used to actually power things) and Apparent Power, the total power that is the sum of the Real and Reactive Power.
Think of it in terms of a glass of beer. Reactive power is the froth, while the beer is the Real Power. The whole glass is the Apparent Power. The ideal ratio is minimum amount of froth (in this case 0%) and maximum amount of beer (100%, since you want the most beer out of your buck).
This kind of situation is called unity, when the power factor is 1 (or 100%). But in real life, there’s always some froth to your beer, as there is Reactive Power to your Real Power. Hope this helps!
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