Reactive power support in AC power systems is an essential factor for secure network operation.Reactive power management could improve voltage profile, reduce transmission losses and increase voltage stability.Ithe sub-transient and transient modes, as well as first swing oscillation and dynamic periods, properreactive power support could lead to improve rotor angle stability, increase voltage recovery speed and reduce the power system oscillations.Reactive power managementconsistof reactive power siting and sizing of the reactive power resources, aimed at the transmission losses reduction,voltage profile improvement, as well as voltage stability enhancement in static and dynamic modes of operation.On the other hand investment costs of the reactive power resources is a key factor for decision making on the reactive power management. Reactive power pricing, especially in the restructured power systems is a serious challenge that has attracted many researchers and has been done in different methods. In this thesis, at the first stage, static reactive power planning has been performedased on WECC standard. Further, dynamic reactive power management has been done according to WECC [1] standard aimed at voltage recovery speed increasing and rotor angle stability improvement. And also a reactive power pricing mechanismis proposed.In the proposed mechanism, capability of reactive power support, namely speed and capacity of the reactive resources, have been discussed. DIgSILENT and MATLAB packages are used for static and dynamic simulations. The proposed reactive power management and pricing has been tested on the 25-Bus Hydro-Quebec test system and its capability is appreciated. Keywords: Reactive power compensation, Pricing, Oscillation mode of grid [1] Western Electricity Coordinated Council (WECC)