Principles and applications of series capacitor banks and shunt reactors are first introduced. Then, the impacts of these apparatus on power systems are reviewed, including the behaviors of shunt reactors in the normal and fault conditions, the behaviors of series capacitor banks under the fault conditions. The effects of these apparatus on the line differential protection are particularly discussed. Challenges of relay applications are investigated with the emphasis on: advantages and disadvantages of including or excluding reactors in the 87L protection zone, solutions to compensate charging current, switching reactors in and out, voltage and current inversion of capacitor banks, sub-harmonic frequency transients, and effects of MOV conducting. In order to demonstrate challenges of the relay application, a long transmission line is studied, where two series capacitor banks are installed at approximately one third intervals on the transmission line and two shunt reactor banks are installed at both ends. Two configuration schemes are presented. Arrangement of the line current differential communications channels to achieve maximum security and dependability is discussed. The settings selection of the line current differential relays is discussed in detail. A simple method to calculate charging current compensation settings for line differential protection is described as well.
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