This paper presents a control scheme and comprehensive analysis for the unified power flow controller (UPFC) on the basis of theory1, computer simulation and experiment. UPFC offers major potential advantages for the static and dynamic operation of transmission lines, but it brings with it major design challenges, both in the power electronics and from the perspective of the power system. In this paper a new model is proposed to study the Reactive compensation of the system when the Unified Power Flow Controller (UPFC) is located at the mid point of the 400KV line between KADAPA-MADRAS lines. The results thus obtained are compared with that of the SVC. The application of UPFC is demonstrated by considering the 400KV substation of Power Grid Corporation Of India Ltd., located at chinnakampalli near kadapa. It is shown that the UPFC has the capability of producing higher Vars in comparison with that of the SVC.