The maintenance of frequency and tie-line power at their respective anticipated values is the major problems faced by the automated generation control (AGC) of an interconnected power system. To address this, normally power electronic devices like flexible AC transmission systems (FACTS) devices are used. While it has been demonstrated that FACTS devices are useful in reducing frequency oscillations and tie-line power variations, but they have limitations in terms of their control range, voltage regulation, power losses and harmonic distortion. To overcome this, a novel approach has been proposed in this chapter to effectively curb frequency deviations and tie-power oscillations by implementing VFT in series with the tie line of a two-area hybrid power system. The hybrid power system under consideration includes wind-sources, solar-thermal, conventional-thermal and a large number of electric vehicles connected to the utility grid. Additionally, a PID controller trained by artificial neural network has been implemented as a supplementary controller to establish effective control over-frequency and tie-power deviations. The study shows that the suggested control technique with VFT exhibits better performance in terms of damping frequency and tie-power oscillations when compared to the strategy without VFT.