Reactive power management in a power distribution network of a power utility and industry plays a major role in reducing distribution loss, in maintaining constant distribution voltage and in improving power factor. The paper presents the simulation studies on a cascaded H-Bridge converter based DSTATCOM for power factor improvement in power distribution set-up using load side compensation. In this novel control strategy, load reactive current is monitored and set as a reference for DSTATCOM controller in such a way that DSTATCOM is able to supply the reactive power demanded by the load both during steady state and transient conditions. For high power applications, cascaded H-Bridge converter is the most ideal choice compared to neutral point clamped inverter and two-level inverter with series connected power devices