When the engineer says sensorless referring to position sensing: the primary regulation of the motor is, for a given speed, to maintain the maximum efficiency. In the outer loop a speed regulation can be implemented (because motor speed can be calculated from the position information available). So for best efficiency, it is very important to commutate at the right time, hence knowing where the rotor is positioned is critical. Commutation essentially means changing the voltage on a given winding, positive to negative, so that continuous rotation can be achieved. In order to find rotor position, which can also be used to derive the speed of the rotor, there are several options. One method is to employ hall effect sensors. The engineer refers to this as a sensor mode, meaning there is a physical device with electronics that is embedded in the motor, that then feeds a signal back to the motor control module. Due to the additional hardware, the cost of such an option is higher, and the life and reliability of the motor assembly is impacted negatively, whereas if in a sensorless mode of detection of position and speed, the additional hardware (hence cost) is eliminated. A key point to understand is the mechanical power in the motor is equal to the back-EMF multiplied by the current. Back-EMF is a voltage that is induced in a winding in the motor by the change in the magnetic field in that winding. Which means even if there is no electrical power or energy supplied to the motor, (i.e. it is just spinning/ freewheeling), back-EMF is generated on the terminals of the motor. Since the mechanical power of the motor is equal to the back-EMF times the current, it is important that both back-EMF and current are in phase, for maximum efficiency.