Induction motors are one of the most commonly used inductive loads in industrial settings. Induction motors may be operated at rated operation, but they are often operated at lower ratings. Induction motors have an inductive load and a power factor of about 0.8 during rated operation, but the power factor drops below this when operating below the rating. A capacitor is attached to the motor terminal to compensate for the low power factor, but the capacity of this capacitor is calculated under the conditions of rated operation of the induction motor and is not suitable for load fluctuations. When the load changes, the current flowing through the stator of induction motor changes, but the excitation current required for magnetization changes very little. When the reactive power required for magnetization of an induction motor is compensated for on behalf of the power source, the power factor can be operated close to 1 even when the motor torque changes.<BR>In this paper, by installing a static synchronous compensator(STATCOM) between the power source and the induction motor side, the reactive power required for magnetization is supplied to the induction motor instead of the power source even when the induction motor torque changes. A control method was presented, and the possibility was analyzed through simulation.