This paper present the static compensator (STATCOM) using the Fuzzy logic controller (FLC) for self-excited induction generator (SEIG) which is used in the standalone Pico-electric power plants. The SEIG has constant output voltage and frequency profile if constant mechanical power is given to it and the constant load is connected across its terminals. However, if SEIG feeding a variable load, the voltage and frequency profile will change, which is not desirable in the power system. If the load is removed, the voltage will rise at a dangerous level, which may affect to other load connected with SEIG. A constant value capacitor is connected for its excitation. If the variable load is connected across its terminal, the capacitor will fail to maintain the voltage regulation and frequency profile. A variable load require the variable reactive power, STATCOM will supply the variable reactive power to the load. The STATCOM compensate the reactive power needed by SEIG for excitation The STATCOM using FLC is employed to maintain voltage regulation of the SEIG. The dynamic model of the SEIG is used which feeds the nonlinear load. The MATLAB/Simulink shows the effectiveness of the control scheme.