According to the government's policy to demonstrate and expand the renewable energy sources, distributed generators such as PV (photovoltaic) and WP (wind power) systems are installed and operated in distribution systems. However, there are many issues related to power quality problems including over-voltage and under-voltage of customers. Especially Blackouts-the total loss of electrical power-serve as a reminder of how dependent the modern world and particularly urban areas have become on electricity and the appliances it powers. In order to overcome these problems, the electric power company have installed a Step Voltage Regulator (SVR) in primary feeders interconnected with distributed generators, and also have established the technical guidelines for the distributed generators to stabilize the customer voltages in distribution systems. However, it is difficult to maintain the customer voltages within allowable limit. Therefore, this paper analyzes the problem of voltage control by SVR in distribution system with large scale PV systems, and presents operating range and voltage control limit of Small Hydropower Generator (SHG) with PF control function. In addition, this paper evaluates the voltage impact in primary feeders depending on voltage control modes of SHG, and then proposes optimal voltage control algorithm. Furthermore, from the simulation results base on the proposed algorithm, it is confirmed that it can contribute to voltage stabilization in distribution system interconnected with large scale PV systems.