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This paper presents and compares the performance of two controllers namely Fuzzy Logic and Proportional Integral applied to a voltage source inverter/converter operating as an active power filter. The active power filter is operated to compensate harmonics and reactive power generated by the non-linear load and power factor correction simultaneously. This work is performed in order to make an accurate comparison of fuzzy logic controller and classical control technique such as PI controller. Fuzzy control rule design is based on the general dynamic behavior of the process. A novel control method for a reactive volt-ampere compensator and harmonic suppressor system is proposed. It operates without sensing the reactive volt-ampere demand and nonlinearities present in the load. The compensation process is instantaneous, which is achieved without employing any complicated and involved control logic.