Despite the problems related to fossil energy resources - mainly the rising prices, their production costs are still less than those of renewable energy resources. In order to make renewables competitive with fossilbased energy sources their conversion costs have to be reduced or kept at acceptable levels. With a view to addressing this specific problem, this work tries to provide a better understanding on the wind energy conversion and to develop some techniques to reduce production costs by reducing the inherent electrical losses of the process.This makes sense especially in relation to the MW-class wind turbines, where an even a small percentage gain in efficiency means a considerable amount of power saving. The research focuses on wind turbines that use the doubly-fed induction generator (DFIG), since this is the most widely used machine type and its topology, depicted in 1.2, presents the degrees of freedom that allow for the targeted loss reduction. The procedure is based on the control of the reactive power flow between the machine, converter and network.Due to the wind energy penetration level achieved in some countries, such as Germany and Denmark, network stability may become a serious problem, as the wind blows without any relation to energy consumption. Since 2001 power companies have launched special guidelines on wind energy production. These guidelines basically point out that wind turbines connected to the main supply have to work as a normal generation unit no longer being considered a negative consumer and fulfilling similar requirements to conventional power plants.Investigations on the black-outs in the U.S. and Canada in August 2003 and Italy in September of the same year pointed out that the cascaded outages of several transmission lines and generating units could have been avoided if controllable reactive power were available. Therefore some recommendations on this issue were presented in where generating units should dispose some reactive power reserve in order to contribute to voltage regulation. These recommendations were also destined to small sized distributed power plants where modern wind power plants fit in.In this work, the main objective of the efficiency optimisation achieved through controlling the reactive power flow is to meet the power companies reactive power production requirements and thus contribute towards the stability of the interconnected system.