Abstract: A compensation circuit for electrical generators is disclosed. In an electrical generator, the electrical current generated in the armature coil induces a magnetic flux in the flux path of the generator. The compensating circuit of the invention includes a conductor that surrounds a portion of the flux path of the generator. This conductor known as the compensating coil, is supplied with a compensating circuit which has a reactive component. The compensating current induces a secondary magnetic flux that has a component that opposes the flux induced by the armature current. In a further embodiment of the invention, a twin generator--generator or twin generator--motor is employed. The compensating coil surrounds the flux path of one of the generators and the other generator or motor is used to supply compensating current to the compensating coil.