A refrigeration system includes a compressor and a capacitor electrically coupled to the compressor. A method of operating the refrigeration system includes measuring voltage values based on alternating current power powering the compressor. The method includes measuring current values based on the alternating current power. The method includes determining, with a controller, a power factor value based on at least one of the voltage values and at least one of the current values. The method includes receiving a supply air temperature value from an air temperature sensor installed in the refrigeration system. The method includes receiving a return air temperature value from an air temperature sensor installed in the refrigeration system. The method includes determining a temperature split based on a difference between the return and supply air temperature values. The method includes determining a fault in the capacitor based on the power factor value and the temperature split.