This project presents detailed modeling and hardware implementation of a harmonics Compensation based on a Reduced switches fifteen-level multilevel voltage source inverter. This type of compensator, which is installed in parallel with the AC grid, is usually referred to as the shunt active power filters  ( APF ) . Nowadays use of high voltage non-linear loads are widely used in industrial and commercial applications and elimination of harmonics in HV system has become an important aspect. Implementation of multilevel inverter  ( MLI )  as compensator in HV system eliminates use of bulky and high cost transformer. The compensation process is based on concept of p-q theory, which is comprised of positive sequence voltage and instantaneous real-power theory. The controller method successfully eliminates harmonics even the supply voltage is distorted. The Selective Harmonics Elimination PWM  ( SHEPWM )  technique is used to generate firing angles to Reduced switches multilevel inver ter switches which reduces the individual device switching frequency. The distribution network which supplies mixed linear and non-linear loads and employing MLI is implemented in hardware