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In recent years, there has been an increasing interest on applying advanced and intelligent control designs in power engineering area. In this paper, damping controllers for a Single Machine Infinite Bus (SMIB) System with STATic synchronous COMpensator (STATCOM) are designed using swarm intelligence. The controller design problem is formulated as an optimization problem where Particle Swarm Optimization (PSO) is proposed to find optimal controller parameters. Nonlinear time domain simulation based multi-objective function is formulated to minimize time-weighted errors in order to damp system oscillations of the nonlinear system model. The effectiveness of the designed controllers is examined under severe system disturbances. The results show that the system performance with the proposed controllers is quite satisfactory and confirm the quality of the damping characteristics of the designed PSO based controllers.