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A universal power quality manager (UPQM) is presented. The active power balance of this UPQM is analysed. Based on the analysis a control scheme is established in a two-phase synchronous rotating dq-frame. In this control scheme the series active filter (AF) is controlled as a current source and makes the input current sinusoidal, while the shunt AF is controlled as a voltage source and it keeps the load voltage at the normal value. The performance of a UPQM with the proposed control scheme under different nonlinear load and source disturbance conditions is experimentally investigated.