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This paper concentrates on the design, control and implementation of an LCL-filter-based shunt active power filter (SAPF), which can effectively compensate harmonic currents produced by nonlinear loads in a three-phase three-wire power system. The use of LCL-filter at the output end of SAPF offers superior switching harmonic suppression with much reduced size of passive filtering elements. This allows SAPF to generate high slew rate output currents that can closely track the targeted reference. Moreover, smaller inductance directly translates into less harmonic voltage drop on the passive output filter, which can minimize the possibility of over modulation, especially for relatively low dc-link voltage (or high modulation index) of SAPF. Some critical issues, like selection of LCL parameters, interactions between resonance damping and harmonic compensation, bandwidth design of closed-loop control system, and active damping implemented with fewer current sensors are all addressed here. An analytical design example is finally presented, being supported with experimental results, to verify its effectiveness and practicality.