Increase in the market share of wind energy in total electricity generation and its impact to power grid has imposed new challenges to the stability of each wind turbine generator (WTG) unit. In the case of power undersupply, the problem on voltage stability and voltage collapse will eventually occur. In this paper, the impact of reactive power control in improving the performance of squirrel cage induction generator-based (SCIG-based) WTGs is presented. In the asynchronous operation of induction machine, the increment of wind power generation is feasible by absorption of more reactive power. Increasing the reactive power consumption of induction generator results in reduction of voltage in the bus connected to the wind farm from the grid. In this scenario, inadequate reactive power control can lead to instability in the power network. The studies conducted in this paper are based on the quasi-static time-domain simulations (QSTDS) and continuation power flow (CPF) algorithm framework. The results obtained indicate that with increment of wind power penetration in a power system, adequate reactive power support is required to maintain stability, else the stable performance of the wind farm will be threatened and will lead to over-speeding of SCIGs. The use of SVC and STATCOM as a practical solution in improvement of wind farms-based power system stability is investigated and presented.