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-This paper presents theoretical analysis based on mathematical model of Static Synchronous Compensator (STATCOM). The basic application of STATCOM is to supply voltage support to the power system. That is, the STATCOM can rapidly supply dynamic reactive power required for short-tem voltage regulation. However, through mathematical model of STATCOM using digital simulation, it is found that the system stability may tend to be unstable under some conditions due to some factors of STATCOM. The performances of STATCOM under specified load variation was simulated with EMTP (Electro Magnetic Transient Program)/RV. Simulation results are presented for a two-level VSC based ±100 MVAR STATCOM connected to a 345 kV simple radial system. Simulation results validate the ability of the STATCOM to improve short-term voltage regulation. With appropriate PI gains, the controller performance is observed reasonably well during capacitive and inductive modes of operation. The simulation results from EMTP/RV represent good dynamic performances of STATCOM during step changes of load variation.