Scale factor is the ratio of the distance between two points on a map to the actual distance between those same two points on the ground. It is important to account for scale factor when routing pipelines as it can vary depending on location, map projection, terrain, and other factors. To calculate scale factor, the central meridian, standard parallels, latitudes in radians, and map scale must be determined. Applying the correct scale factor ensures accurate routing of pipelines across different areas and terrains by minimizing distortion between map distances and true distances.