Amplitude, phase angle, active and reactive powers flowing in each busbar of a power system can be seen by performing a load flow analysis. From these data, it is possible to determine the voltage drop, the distribution of the forces, the loading of the equipment and the losses of the related power system. Then, Active power losses can be reduced by making improvements at the points where losses are present in the power system. Power losses can be reduced by reactive power compensation considerably. In this study, Differential Evolution (DE) algorithm is used to determine the values of the capacitor groups to be added to the corresponding busbar to reduce the losses of 154 kV transmission system. The optimum load flow is ensured by optimizing a transmission system with the developed algorithm.