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In this paper, the combination of a thyristor-switched shunt reactor and a current source converter-based active power filter has been proposed for mitigation of power quality (PQ) problems of Light Rail public Transportation Systems (LRTSs) fed by long medium-voltage underground cables. A case study has been carried out on a typical LRTS to assess the performance of the proposed solution for both capacitive reactive power compensation of underground cables and harmonic filtering of 12-pulse catenary rectifiers. It has been shown by extensive field tests carried out that this solution meets the requirements satisfactorily, thus constituting a complete solution to the PQ problems of LRTS. Conventional PQ solutions have been also assessed, and the corresponding theoretical results are given in comparison with the proposed system.