A new kind of FACTS equipment, the multi-functional Flexible Power Conditioner (FPC), is proposed in this paper. The proposed equipment makes use of an advanced synchronous condenser with a flywheel, which is controlled by a vector technology based AC excitation system. Incorporating the functions of the synchronous condenser and flywheel energy storage, the proposed FPC can perform multi-functions including energy storage, dynamic active and reactive power conditioning when used in power system stability enhancement. This enables the proposed equipment to considerably enhance power system dynamic angular and voltage stabilities. The basic principles of the FPC, the steady state power exchanging characteristics between the FPC and the connected power network under different operating conditions, the SPWM based double voltage source converter used as a variable frequency power source for excitation, the vector control of the three phase VSC and the simulation results of contribution of the FPC in power system stability enhancement are all given.