A new type arc suppression coil combined with shunt reactor is proposed. Based on the main circuit and control structure of the arc suppression coil， its dynamic tuning method and working mode are determined. The arc suppression coil has 16 taps or 32 taps. The device monitors the varieties of earth fault current in case of the normal operations of the power network while calculating the earth fault current accurately with a precision of 1 A in case of the network changing. The arc suppression coil can be quickly set to the full compensation if the single phase-to-ground fault occurs. At the same time， the selection of fault line based on the fault component principle can improve the success ratio of fault line selection significantly. The field tests reveal that the arc suppression coil can meet the practical requirements.