In recent years, awareness of environmental problems is growing, and the price of electric power purchased by electric companies has been expensive for power plants utilizing natural energy. Thus, the introduction of wind power generation is being promoted in Japan. Generally, squirrel‐cage induction machines are widely used as generators in wind power generation systems because of their small size, light weight, and low cost. However, the induction machines do not have a source of excitation. Thus, inrush currents and instantaneous voltage drops occur when the generator is directly connected to a power grid. To reduce the inrush currents, an AC power regulator is used. Wind power generators are frequently connected to and disconnected from the power grid. However, when the inrush currents are reduced, harmonic currents are caused by phase control of the AC power regulator. And the phase control of the AC power regulator cannot control the power factor. Therefore, we propose the use of the AC power regulator to compensate for the harmonic currents and reactive power in a wind power generation system, and demonstrate the validity of this system by simulated and experimental results. © 2005 Wiley Periodicals, Inc. Electr Eng Jpn, 154(2): 58–67, 2006; Published online in Wiley InterScience (http://www.interscience.wiley.com). DOI 10.1002/eej.20254