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A transponder-based system is proposed for wireless nonradiative power transfer. The system consists of three elements: a transmitter, a receiving loop, and a transponder at a fixed distance from the transmitter. The transmitter and the transponder are made of concentric, reactively loaded wire loops. One loop of the transmitter is directly fed by a power source, while its remaining loops and those of the transponder act as parasitic loops. The reactive impedances of the parasitic loops comprising the transmitter and transponder are chosen to maximize power transfer from the source to the receiving loop. The equivalence of the system with a two-port network is used to derive the required reactive impedances. A conjugate impedance match is applied to both input and output ports of the equivalent two-port network for maximum power transfer. The proposed transponder-based scheme overcomes the monotonic decay of efficiency with distance that is seen in classical wireless power transfer systems. An improvement in efficiency exceeding 50% is achieved at larger distances when compared to similar systems without a transponder.