<p>The power quality determines the fitness of the electrical power to the consumer devices. To improve the quality of the power delivered many compensating devices are used. The FACTS devices are normally used to reduce the power quality problems by inducing one or more AC transmission parameters. The static synchronous compensator (STATCOM) can act as either a source or sink of reactive AC power to an electricity network. The basic electronic block of the STATCOM is the voltage-source inverter that converts an input dc voltage into a three-phase output voltage. The STATCOM employs an inverter in order to obtain the voltage source of adjustable magnitude and phase from the DC link voltage on the capacitor. In this model, the STATCOM is designed with the five level diode clamped converter (DCC) controlled by space vector pulse width modulation (SVPWM) technique. The space vector technique with α, β frame is referred here. The dc link capacitor voltage equalization for the five level diode clamped converter was explained. The Total Harmonic Distortion of the source current will be considerably reduced.</p>