The paper offers a comprehensive analysis and control of a Residual Current Compensator (RCC) for suppressing both the active and reactive components of single-phase-ground fault currents. Thus, ensuring almost zero fault currents in compensated distribution networks when bushfire risks are of a major concern. Based on the current injection approach, the proposed RCC encompasses a single-phase Voltage Source Converter (VSC) connected to the neutral point of the main power substation through a stepping up transformer. A detailed analysis is given to estimate the residual current to be injected during faults. A Proportional-Integral (PI) controller is then used to control the injection of the estimated current by the VSC. The performance of the proposed RCC is illustrated using a simulated real power system.