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In this paper, a configuration with modified single-phase H-bridge AC-DC converter for DC ripple compensation and power decoupling with a DC-DC converter for bidirectional power flow between PHEV (Plug in Hybrid Electric Vehicle) and power grid is proposed. It is well known that single-phase PWM voltage source converter (VSC) suffers from second-order ripple power and subsequent DC-link voltage pulsation. To reduce this low frequency pulsation of DC-link voltage and to obtain the sinusoidal grid current with unity power factor, a modified single-phase H-bridge PWM rectifier consisting of a conventional H-bridge PWM VSC and a pure passive auxiliary circuit is presented with a bidirectional DC-DC converter in order to ensure the bi-directional power flow management between PHEV and power grid at unity power factor and reduced ripple current. The modified H-bridge has the advantage of less number of switches and small DC link capacitor. First 230 V 50 Hz AC supply from source is converted to 400 V DC through single phase VSC and again the battery of EV or PHEV is charge in buck mode and discharge in boost mode with the help of bidirectional DC-DC buck - boost converter. In discharging mode, it delivers energy back to the grid at 230V, 50 Hz. A battery with a charging power of 3.6 kW at 120 V is used in PHEV.