AbstractWith an increase in the number of electronic devices, such as personal computers, connected to power distribution lines in commercial buildings, problems associated with their use, such as voltage distortion on utility outlets and excessive neutral current on the distribution lines, become more and more serious. This paper shows control methods and compensation characteristics of series active filters connected to the neutral conductor. The distinctive functions of the proposed active filter are the mitigation of third harmonic voltage and the reduction of neutral current in three‐phase four‐wire distribution systems. The required kVA rating of the proposed active filter is less than 10% of that of the harmonic producing leads. A control method of the DC capacitor voltage on the active filter circuit is also described. It was experimentally demonstrated that one of these two functions of the active filter (to mitigate harmonics or to reduce the neutral current) can be realized selectively and that the DC capacitor voltage of the active filter can be regulated to a desired value. © 2006 Wiley Periodicals, Inc. Electr Eng Jpn, 155(4): 53–63, 2006; Published online in Wiley InterScience (www.interscience. wiley.com). DOI 10.1002/eej.20227