Presently, the quality of power supplied is essential to many customers. Power quality (PQ) is a valued utility service where many customers are prepared to pay and get it. In the future, distribution system operators ought to decide, to provide their customers with distinct PQ ranges at different prices. Here, in this paper, a new control action to improve and maintain and enhance the power quality of an electrical power system is proposed in this paper. Fuzzy based distributed power flow controller (DPFC) is designed and put into action to compensate the voltage imbalances arising in a power system. This customized DPFC is an advanced FACTS device, which has its structure analogous to unified power flow controller (UPFC). DPFC comprises of both series and shunt converters, in which its three phase series converter is distributed over the transmission line as several single phase static converters ensuring high controllability and reliability at a low cost compared to an UPFC. A central controlling circuit is designed to supply reference signals to each of the individual controlling circuits of both series and shunt converters. This customized device is applied to a single machine infinite bus power system having nonlinear loads connected to it and is simulated in MATLAB/Simulink environment by using OPAL-RT 5600 Real-time digital Simulator. The results demonstrate the validation of proposed technique to enhance the power quality.