Voltage can be controlled by controlling the reactive power flowing in the system. The reactive power can be consumed with inductive reactance (reactors) and produced with capacitive reactance (capacitors). SVC can be understood as adjustable impedance that provides reactive power proportionally to the system supply voltage. SVC impedance can be modified by combining adequate amounts of inductive and capacitive reactance. Inductance is provided by thyristor controlled reactors (TCR) using Merus thyristor valves, while the capacitive part consists of fixed capacitor banks.

When the inductive part is operating at maximum current, the SVC’s output reactive power is zero or inductive, drawing the voltage of the connection point down. When inductive part current is zero, the SVC system, with its maximum capacitive power, pulls the voltage of the connection point up. The capacitor banks also work as passive harmonic filters, fine-tuned to reduce harmonics generated by the thyristors of TCR and by the loads. With the line-commutated thyristors the reaction time of SVC is typically half a network cycle.