This paper proposes a novel UPFE based on H-bridge modules, isolated through single-phase multi-winding transformers. The dynamic performance of proposed system was analyzed by simulation with EMTDC, assuming that the UPFC is connected with the 138-kV transmission line of one-machine-infinite-bus power system. The proposed system can be directly connected to the transmission line without series injection transformers. It has flexibility in expanding the operation voltage by increasing the number of H-bridge modules.