In this research work, two Back to Back connected 2-level voltage source inverters (BBC-VSI) under three phase three wire weak utility grid is examined. Generally, the challenges addressed in the modern utility grid are end users’ nonlinear loads and dependency on conventional energy sources. The end users’ nonlinear loads generate power quality (PQ) issues and dependency on conventional energy sources raises environment pollution and economic crises. The BBC-VSI based distribution static compensator (DSTATCOM) topology consists of two voltage source inverters (VSIs) supplied by a distributed energy resources (DERs) supported common DC-link capacitor. A sparse least mean squares (SLMS) technique is selected for generating the pulses IGBTs. The SLMS technique offers high estimation speed, less than one cycle weight convergence, fast transient response and small error in steady state over conventional technique. A holistic comparison is performed between the BBC-VSI and VSI using the field programmable gate arrays (FPGA) SPARTAN-6 control board regarding optimal power flow control, which shows the BBC-VSI is competitive. Also, it is authenticated under different conditions like source current shaping before and after compensation, source power failure, DER power fluctuation, nonlinear load variation, etc., which are naturally encountered in a modern utility grid.