I hope someone will be able to answer my question. What happens to the energy bill if the capacitor bank is over
compensating, ie creating negative vars on one phase. This
is a 3 wire Delta service. Why would a bank overcompensate?
Maybe because you have a blown fuse on one of the other phases.
The impact on billing depends on the utility's metering setup and your rate tariff. It would only impact the power factor/reactive portion of the bill, not the energy or kw demand.
Older meters probably are not capable of metering reverse power or var flow, so they wouldn't know anything about it. Newer digital meters could register it, but it depends on how the meter is configured as to what happens.
The utility usually doesn't care if the system is slightly capacitive, but consistent excessive leading PF may cause them to notice.
As far as the overcompensation, if it is a fixed bank, that is, it doesn't have steps that close in and out as the reactive load changes, the capacitor bank may be too large for the application. If it is an automatically switched bank with steps, it should be checked out for proper programming and connections, especially if it is overcompensating on only one phase. What type of capacitor system is it? Voltage? kVAR rating?