The transformers have been widely used in traditional power system, the primary functions of which are voltage-transformation, isolation and energy-transfer. Now with the development of Smart-Grid, power system requires an increasing penetration of the renewable energy resources and other distributed generations around loads, and an active role for DSOs in controlling the network stability, optimizing central and security. Owing to the bulky iron cores, heavy copper windings and simple functions, the traditional transformer can't satisfy the requirements of SG. Power Electronic Transformer which has been developed for years, can adjust to the development of SG, and improve the performance of distribution system. This paper presents a new topology of PET based on three-level converter, which is used in active medium-voltage distribution network, and supplies a possible solution for bi-directional energy flow of generated loads, and the stability of PS. With the high-performance control strategies-SVM, PET not only realized the all functions of old transformers, but also permitted the distributed power to inject into network. Additionally, the proposed PET performs typical functions and has advantages such as power factor correction, voltage regulation, voltage sag and swell elimination, voltage flicker reduction and protection capability in fault situations. In addition, it has other benefits such as light weight, low volume and no toxic dielectric coolants. First the paper introduced the fundamentals of PET, and studied on the mathematical model of the new topology. In order to verify the validity of this device, we used MATLAB/PST software to simulate the PET model. As a result of divided DC bus with H-bridge converter and connecting of DGs, the neural point's voltage of DC-Bus is unbalanced, the paper proposed an arithmetic to overcome this problem and suppress the effect of ripple voltage on common DC-bus. Eventually simulations results validate the feasibility- - of the new topology and the control strategies.