The SVC (Static Var Compensator) based on voltage source converter (VSC) is used for voltage regulation in transmission and distribution system. The SVC can rapidly supply dynamic VARs required during system faults for voltage support. The apparent impedance is influenced by the reactive power injected or absorbed by the SVC, which will result in the under reaching or over reaching of distance relay. This paper presents simulation results of the application of distance relays for the protection of transmission systems employing flexible alternating current transmission controllers such as SVC. The complete digital simulation of the Static Var Compensator within a transmission system is performed in the MATLAB/Simulink environment using the Power System Block set (PSB). This paper presents an efficient method based on wavelet transforms, fault detection, classification and location using ANN technique which is almost independent of fault impedance, fault distance and fault inception angle.