Higher harmonic power components and fundamental wave reactive power components are derived from a load voltage and current, using theory (instantaneous p-q theory) regarding instantaneous real power and instantaneous imaginary power. Gains are then obtained which make the higher harmonic power components and fundamental wave reactive power components not exceed predetermined limit values. The higher harmonic power components and fundamental wave reactive power components are respectively multiplied by the gains to obtain limited higher harmonic power components and fundamental wave reactive power components. An output current command is generated in accordance with the limited higher harmonic power components and fundamental wave reactive power components. The output current command is supplied to an inverter which in turn supplies a compensation current to the power system.