Efficiency is the ratio between the output power to input power
h = output power / input power
Efficiency values ranging from 0 to 1, in the real world the efficiency values typically ranged from 0.6 to 0.8, the bigger the better. Efficiency applies to direct current (direct current, dc), also applies to alternating current (alternating current, ac). Power lost at the output is usually converted into heat, occurs in coils, resistors, condensers, transformers, transistors, ICs, etc.. Power can also lost due to friction, usually occurs in electric motors, generators, alternators, pumps, compressors, air conditioning (ac), etc..
Especially on alternating current, there are other things that affect the power output and make it less than the input power, it is the power factor (pf):
pf = real power / apparent power = watt / voltampere
In direct current, power in watts unit is always equal to the power unit voltamperes (va). Because power factor in direct current is always close to or equal to 1 (one).
In alternating current, a resistive load which is produced by resitor component, has a power factor close to 1, because the frequency of voltage and current are always synchronous. So, if the equipment contains only resistors such as heater, soldering iron, incandescent lamps, etc., the power in watts can be considered equal to the power in voltamperes unit.
For inductive load, then the alternating current frequency is not synchronized with the frequency of voltage, current phase lags behind the voltage phase. Therefore, the voltage multiplied by amperage is not the same as watts. Then apply power factor smaller than 1 (one).
Likewise, if the alternating current gets capacitive load, the voltage lags behind the current phasenya. Then apply power factor smaller than 1 (one).
Power factor can also be calculated by the difference degree in phase of voltage and amperage:
pf = cos q
The picture below shows charts of voltage, amperage, and power, with a phase difference of 30 degrees or power factor = cos q = cos 30 = 0.87, this is a very good power factor.
The picture below shows charts of voltage, amperage, and power, with a phase difference of 90 degrees or power factor = cos q = cos 90 = 0, very low power factor. We can see power curve is going down below zero line or negative, and positive part of power chart is about the same as negative part of power chart, so effective power or power in watt is close to zero.
This Excel file has chart to simulate voltage, current, and power for certain power factor.
One way to improve power factor is by installing parallel capacitors and located as close as possible to inductive loads (coils, motors, etc.). The greater the load the greater capacitor, therefore cost consideration will be needed. Some power loss and converted to heat and current leaks in capacitor will reduce efficiency. For electric motors, always apply load close to the load rate, where the motor is designed to work most efficiently. Prevent equipments operate with voltage above rating.