The power-electronic-based loads such as adjustable speed drives, rectifier equipment used in telecommunica-tion networks, power supplies, domestic appliances, etc offer highly nonlinear characteristics. These nonlinear loads draw non-sinusoidal [1] currents from ac mains and cause reactive power burden and excessive neutral current. They are also responsible for lower efficiency and interference of distribution system with the nearby communication networks. To improve the efficiency, capacitors are employed which also leads to the im-provement of power factor of the mains. On the other hand, to reduce the interference with the communication network due to harmonics in the current flowing in the distribution system, passive-filters are used. But they have the limitations of fixed compensation, large size, and that they can create new system resonance