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A new control scheme for a single-phase diode-clamped rectifier is proposed to achieve a unity power factor, balanced neutral-point voltage and constant DC-bus voltage. Four power switches are used in the rectifier to generate a three-level PWM waveform on the rectifier terminal voltage. The fine current command is derived from a DC-link voltage regulator and an output power estimator. The hysteresis current controller is used to track the line current command. To balance the neutral-point voltage, a capacitor voltage compensator is employed. The main advantages of using a three-level instead of a two-level PWM scheme are that the blocking voltage of each power switch is clamped to half the DC-bus voltage (if the off-state resistance of power switches is equal), and the voltage harmonic on the AC side of the rectifier is reduced. The effectiveness of the proposed control algorithm is verified by software simulations and experimental results from a 1 kW laboratory prototype.