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The amount of reactive reserves at generating stations is a measure of the degree of voltage stability. With this perspective, an optimized reactive reserve management scheme based on the optimal power flow is proposed. Detailed models of generator limiters, such as those for armature and field current limiting must be considered in order to utilize the maximum reactive power capability of generators, so as to meet reactive power demands during voltage emergencies. Participation factors for each generator in the management scheme are predetermined based on the voltage-var (V-Q) curve methodology. The Bender's decomposition methodology is applied to the reactive reserve management problem. The resulting effective reserves and the impact on voltage stability are studied on a reduced Western Electric Coordinating Council system. Results prove that the proposed method can improve both static and dynamic voltage stability.