Self-excitation of induction motors compensated by permanently-connected capacitors is investigated in this paper. Theoretical analyses of self-excitation phenomenon are carried out by using some simplified equivalent circuits, and a hybrid mathematical model in ABC/dq axes, respectively in steady-state, and transient-state. An unusual operating condition about water pumping stations is reported, in which water within the pipeline may drive the motor in the reverse direction at speeds higher than synchronous, when a supply interruption coincides with a check valve failure. In order to prevent the motor from dangerous overvoltages due to self-excitation, it is recommended to connect a simple static protection circuit consisting of a resistor in series with a thyristor switch between any two lines of the motor. Critical resistance boundaries which will lead to loss of excitation, and demagnetisation of the rotor core are determined separately as a function of operating speed. A suitable resistance value chosen in the Safe Design Area constitutes a reliable protection mechanism against self-excitation.