STATCOM based on Z-source inverter is combined with energy storage system through DC/DC converter in this paper, which not only can compensate the reactive power ,but also can compensate the active power. Aiming at the traditional inverter has the disadvantage: the lower inefficiency, is susceptible to electromagnetic interference and need join the dead-time, this paper proposes the STATCOM based on Z-source inverter. Firstly, it deduces the discrete model in dq rotating coordinates by analyzing its fundamental principles.