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This paper proposes a novel control design for the unified power quality conditioner (UPQC). This design, enabled by a control framework that employs the output regulation (OR) theory, is also made up of an exogenous Kalman filter used to extract the state components of the distorted supply voltage and load current, and a plant Kalman filter as a state observer. In addition, the same framework integrates the major functions of the UPQC with ease to unify the treatments of several power quality problems including system harmonics in the supply voltage and load current, sags/swells in the supply voltage, variations in the load demands, and poor power factor at the supply side. A linear quadratic regulator-based self-charging circuit is also incorporated into the control design so that the UPQC operates without relying on an external dc source. Simulation and experimental studies on a single-phase power distribution system are used to verify the performance and real-time implementation of this control design with the UPQC.