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A novel method to limit the short-circuit current in the distribution network is introduced in this study. The short-circuit limiter is a part of cascade H-bridge distribution-static synchronous series compensator (D-SSSC), which is placed in series with the line to manage the power flow in the loop distribution network. Hence, the short-circuit limitation and power flow management is achieved using only one power converter. During the fault, the D-SSSC inverter is changed to a rectifier by turning off the converter switches and using the anti parallel diodes. The transient thermal analysis of the converter verifies that the components operate within the safe operation area during the fault. The appropriate selection of the DC bus capacitors are discussed both, to limit the fault current below the diode surge current, and to prepare adequate reactive power for normal power flow control. Simulation studies are based on a model inspired by a part of the Tehran electrical distribution network. Moreover, a seven level cascade H-bridge is implemented to control the power flow and to limit the short-circuit in the simple line model.