A hybrid distribution transformer (10, 12, 14, 16, 18, 20, 66, 68, 76, 90, 300, 301, 340, 374) having a primary winding structure disposed on a primary side for receiving input voltage (Vin) and current and a secondary winding structure disposed on a secondary side for providing output voltage (Vout) and current, the hybrid distribution transformer comprising: a ferromagnetic core (40, 306, 377, 392); a winding structure comprising at least one first winding and at least one second winding wound around the core (40, 306, 377, 392), wherein the at least one first winding is disposed on one out of the primary or secondary sides and the at least one of the second winding is disposed on the other one out of the primary or secondary sides; and a power electronic module connected to the primary winding structure or the secondary winding structure, the power electronic module comprising: a voltage source converter connected to at least one first winding and being configured to convert between DC and AC voltages, the voltage source converter comprising: at least one switching bridge (116, 142, 144) comprising two or more switching devices (122, 148, 186, 318); a DC bus (120, 146, 316, 404) connected in parallel with the at least one switching bridge (116, 142, 144,); and a controller (114, 320, 370) connected to at least one switching bridge (116, 142, 144) and being configured to control the at least one switching bridge (116, 142, 144) to: - provide reactive power to a load through the transformer coupling, thereby controlling the power factor on the primary side of the hybrid distribution transformer; and - maintain the output voltage (Vout) at a set value by reducing variations in the output voltage (Vout) in the event of a change in the input voltage (Vin). a ferromagnetic core (40, 306, 377, 392); a winding structure comprising at least one first winding and at least one second winding wound around the core (40, 306, 377, 392), wherein the at least one first winding is disposed on one out of the primary or secondary sides and the at least one of the second winding is disposed on the other one out of the primary or secondary sides; and a power electronic module connected to the primary winding structure or the secondary winding structure, the power electronic module comprising: a voltage source converter connected to at least one first winding and being configured to convert between DC and AC voltages, the voltage source converter comprising: at least one switching bridge (116, 142, 144) comprising two or more switching devices (122, 148, 186, 318); a DC bus (120, 146, 316, 404) connected in parallel with the at least one switching bridge (116, 142, 144,); and a controller (114, 320, 370) connected to at least one switching bridge (116, 142, 144) and being configured to control the at least one switching bridge (116, 142, 144) to: - provide reactive power to a load through the transformer coupling, thereby controlling the power factor on the primary side of the hybrid distribution transformer; and - maintain the output voltage (Vout) at a set value by reducing variations in the output voltage (Vout) in the event of a change in the input voltage (Vin). a voltage source converter connected to at least one first winding and being configured to convert between DC and AC voltages, the voltage source converter comprising: at least one switching bridge (116, 142, 144) comprising two or more switching devices (122, 148, 186, 318); a DC bus (120, 146, 316, 404) connected in parallel with the at least one switching bridge (116, 142, 144,); and at least one switching bridge (116, 142, 144) comprising two or more switching devices (122, 148, 186, 318); a DC bus (120, 146, 316, 404) connected in parallel with the at least one switching bridge (116, 142, 144,); and a controller (114, 320, 370) connected to at least one switching bridge (116, 142, 144) and being configured to control the at least one switching bridge (116, 142, 144) to: - provide reactive power to a load through the transformer coupling, thereby controlling the power factor on the primary side of the hybrid distribution transformer; and - maintain the output voltage (Vout) at a set value by reducing variations in the output voltage (Vout) in the event of a change in the input voltage (Vin). - provide reactive power to a load through the transformer coupling, thereby controlling the power factor on the primary side of the hybrid distribution transformer; and - maintain the output voltage (Vout) at a set value by reducing variations in the output voltage (Vout) in the event of a change in the input voltage (Vin).