In recent years, the development of photovoltaic (PV) power generation has continued and its range of applications has also expanded to different fields. Many PV system designs now not only perform general power generation tasks, but also provide various functionalities such as harmonic mitigation, voltage/frequency regulation, and active/reactive power (P/Q) management. In this study, we develop a PV static synchronous compensator (PV-STATCOM) system with multimode control for the mitigation of voltage fluctuation caused by an industrial power system with the operation of an AC electric arc furnace (EAF) load. In order to well model some nonlinear facilities operated in the studied system and to effectively observe the voltage fluctuation trend, field measurements by power quality (PQ) recorders with voltage and current sensors are performed on a real steel plant that is fed from a 161 kV utility grid. The proposed multimode control strategy for the PV-STATCOM consists of a pure PV mode (PPM), partial STATCOM mode (PSM), and full STATCOM mode (FSM). The switching of various control modes is implemented under specific rules to ensure appropriate reactive power management in the PV inverter (PVI). Finally, the performance of the proposed PV-STATCOM design is tested and verified by MATLAB/Simulink. Results show that the proposed multimode PV-STATCOM has greater effectiveness than the traditional design.