Using capacitors to reduce reactive power
Is my thought process correct? Am I right in my understanding of reactive power?

You are essentially correct except for:

(as they dissipate power when the inductor consumes it)

Should be: &quot;as they store energy when the inductor releases it and release energy when the inductor stores it.&quot;
There are several reasons that motors don't come with capacitors attached.

The motor does not have a convenient place to put them.

They would add cost to the motor that the purchaser may not need to incur.

Having the capacitors connected all of the time could cause the motor not to stop as quickly when shut off. The stored energy can help keep the motor running.

It may be more cost-effective to have just a few larger capacitors for many motors.

That is the way it has been done for the last century, from the time no one realized that adding capacitors could save energy and free up system power capacity.

Some motors are electronically controlled and do not need capacitors.

The need for capacitors must be handled a bit differently if there is harmonic distortion in the power system. Harmonic voltages in the distribution system can cause resonance oscillation currents between the capacitors and the motor and transformer inductance. One remedy is to add resistors and inductors to groups of power-factor correction capacitors so they can also serve as harmonic filters.


There are probably some additional reasons.