Abstract The active power filter has been proved to be an effective method to mitigate harmonic currents generated by nonlinear loads as well as to compensate reactive power. In the implementation of a three-phase active power filter, it is crucial to have a procedure (i.e. the compensation strategy) to generate the reference compensation currents by its control circuit. This paper proposes a simple and efficient a – b – c reference frame-based strategy to determine the reference compensation currents for both three-phase three-wire and three-phase four-wire active power filters. Simulation and experimental results show that the proposed compensation strategy yields a simpler design of the control circuit than those obtained by using the conventional instantaneous reactive power theory (i.e. p – q theory). A competitive active filter performance is also achieved.