Static compensator (STATCOM) has been widely proposed for power quality and network stability improvement. It is easily connected in parallel to the electric network and has many advantages for electrical grids. It can improve network stability: power factor, power transfer rating and can avoid some disturbances such as sags and swells. Most of STATCOM controllers are based on voltage controllers that are based on balanced d-q transform. However, they are not thorough solutions for network disturbances since in most cases single-phase disturbances occur in electrical networks that cannot be avoided by the conventional controllers. Voltage mode controllers are also not capable of responding fast enough to the changes expected of a network system. This paper proposes a new current mode controller to overcome the mentioned problem. The approach uses a fixed frequency current controller to maintain voltage levels in voltage sags (dips). This approach is also simple and can be easily implemented by digitally. It has superior performance over conventional methods in terms of harmonic reduction in STATCOM output current. Another important factor for STATCOM effectiveness in sag mitigation is its sag detection method. This paper also introduces a new sag detection method based on Goertzel algorithm which is both effective and simple for practical applications. The simulation results presented illustrate the superiority of the proposed controller and sag detection algorithm to be utilized in the STATCOM. (C) 2010 Elsevier Ltd. All rights reserved.