This paper describes the review of capacitance determination of an induction motor working as generators. An experimental based capacitance value calculation has been propose and implemented successfully in laboratory model of induction generator. A 5Hp, 220V, 15A separately excited d.c motor coupled (mechanically) with a 2.2kW, 415V, 4.7A, Y-connected, 1440-rpm induction motor emulates the induction generator characteristics with a 50 microfarad capacitor bank (calculated capacitance) connected across the stator windings. For validation of the proposed method, experimentation has been rig-up and tested in the laboratory. The result has a good agreement with this method and extends to use of this method, to calculate the additional capacitance required to reduce the reactive power burden in grid connected induction generator, used in wind power (variable speed) generation.