For modular multilevel converters (MMCs)

a quite large capacitor is required to limit the ripple component of the capacitor voltage

which causes size and cost problems. A new operation mode and control strategy is proposed to reduce the capacitor requirements of MMC. In the proposed operation mode

the DC voltage of the submodule is appropriately decreased to make the maximum permissible ripple voltage increased and the choice of a smaller capacitor possible. The required capacitance in the proposed operation mode is analyzed at length. To implement the proposed operation mode

an instantaneous current control strategy is proposed to directly control the MMC arm currents. In the proposed control strategy

the AC-side current

the circulating current

and the DC-side current can be controlled

respectively. The simulation results using RT-LAB have verified the feasibility and effectiveness of the proposed operation mode and control strategy. This work is supported by National High Technology Research and Development Program of China (863 Program) (No. 2011AA05A102).