Power system stability is a serious concern of power system engineers and utilities especially after the recent occurrences of major events of black outs. Power factor improvement devices such as capacitors, optimally placed in series or shunt in any given network can improve its voltage as well as angular stability. Thermal limits of lines can be observed as the system is visible at all times through synchrophasor data. For this, New England 39 Bus system is used as test system. The simulations are carried out on PSSE. Compensation on selective buses is carried out using sensitivity analysis.