In modern power systems, since most loads are inductive by nature, there is an ongoing power quality issue and researchers’ interest in improving the power factor is widespread, as inductive loads have a low power factor that depletes the system’s capacity and has an adverse effect on the voltage level. The measurement and acute analysis of voltage- and current-level waveforms is essential to tackle power quality issues. This article presents a detailed case study and analysis of real-time data measured from a frequency converter, which is used to operate the motor of a ventilation system. The output of the frequency converter is a highly distorted current wave. A hybrid Fourier transform (FT)- and wavelet transform-based solution has been proposed here to diagnose and identify the causes of motor failure in the ventilation system. The traditional FT did not give a detailed analysis of this type of signal, which is highly contaminated by noise. Therefore, first, the signal is preprocessed for data denoising using the wavelet transform. Second, the Fourier analysis is performed on the filtered signal for frequency analysis and segregation of fundamental frequency components, higher-order harmonics, and suppressed noise. The spectrum analysis reveals that the noise is generated due to the rapidly switching circuits in the frequency converter and this unfiltered signal at the output of the frequency converter causes motor failure.