Power quality is highlighted as an important parameter in modern power systems. Moreover, grid-connected photovoltaic power plants are increasing significantly in size and capacity. Elsewhere, due to the progressive integration of nonlinear loads in the grid, the principal role of a Solar Energy Conversion System (SECS) is not only to capture the maximum power from solar but, also to ensure some ancillary services and improve the quality of power. This paper presents a novel strategy dedicated to improve the management of active power generation, reactive power compensation and power quality of a SECS, while guaranteeing the possibility of exploiting the full capacity of the Power Conditioning System (PCS) and the PhotoVoltaic System (PVS). The proposed control algorithm is applied to a large scale PVS connected to the grid through a cascade of a DC-DC converter and a PWM inverter. This control strategy manages the SECS function's priorities, between main active power generation, reactive power compensation and active filtering in such a way to guarantee a smooth and stable DC voltage and ensure a sinusoidal grid current. Top priority is given to the active power production over power quality improvement. Then, priority is given to reactive power compensation over mitigation of current harmonics absorbed by the non-linear load connected to the Point of Common Coupling (PCC). Moreover, the whole system upper limits of active and reactive powers have been determined in the (PQ) power plane on the basis of PVS available power, converters rated power and DC bus voltage smoothness and stability. Finally, a control procedure dedicated to the calculation of the inverter current commands is proposed in order to exploit the full capacity of the SECS and respect the determined power limits. Simulation results confirm the effectiveness and the performance of this control strategy and prove that the SECS can operate at its full power whilst the power quality can be improved by reactive power compensation and active filtering.