Due to the impact on electricity suppliers, equipment manufactures and customers Power quality becomes very important issue. Most of the modern industrial equipments are non linear loads mostly based on electronic devices such as variable speed drives. As a result of non linear loads the AC sine wave purity is lost. Disturbances are produced not only due to non linear loads but also due to fault conditions on distribution grid. Voltage sag is the major power quality issue and is to be addressed in the present grid scenario. Among the various method available for mitigation of voltage sag and swell one of the fast and preferred method is dynamic voltage restorer (DVR). DVR offers most effective solution for power quality issues for sensitive loads than shunt compensators. The shunt compensators require bulky and costly equipment since they are injecting missing potential through reactive power. In this paper the performance of DVR with series compensation of active power using Battery as energy source and dq technique for control VSC is studied using MATLAB Simulink. © Research India Publications.