This paper proposes a new power conditioning system for the SMES composed of a thyristor PWM converter with a resonant commutation circuit. The operation of the proposed system and the dynamic interaction between SMES and the power system is analyzed by a theoretical approach with equivalent circuits and verified by computer simulations with EMTP, considering a typical 154kV power system. The proposed system can provide a solution for the power factor regulation and harmonic level reduction in the ac terminal with low-cost system configuration.