This paper concerns the development of the transformer that can reduce harmonics supplied to the system if the output of photovoltaic inverter in the photovoltaic system is grid-connected, and suggests that problems of harmonics and power factor degradation in the grid-connected photovoltaic system can be improved. In this study, the burden of increasing the investment in new facilities and securing their installation space due to harmonics has been substantially eased through the development of a hybrid transformer possessing unbalanced function and harmonics reduction function using zig-zag coils, and most of all, it is expected that the development of such high efficiency hybrid transformer possessing functions of transformation and reducing harmonics can improve the power quality as well as prevent damages caused by harmonics, leading to suppress unnecessary loss of electric power and thereby contribute to energy savings.