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The present paper is concerned with power system stabilization by active power control of dispersedly allocated micro SMES units. Several faults are assumed on the model power system, and a transient performance index is defined with all of the assumed faults taken into account. The optimal allocation of micro SMES units is determined through Tabu Search (TS) algorithm. The stabilizing effects in case of the optimally distributed allocation are compared with the case of concentrated allocation through the performance index and the transient simulations. It is made clear from the results of the simulations that the optimal allocation is more effective for the transient stability enhancement than the concentrated allocation, if the total rating of the SMESs is the same.