In this research work, the transient overvoltage suppression capability and harmonic filtering performance of C-type 2nd harmonic filters are optimized by using two-stage damping resistors; one is permanently connected to the filter circuit, while the other one is switched on by back-to-back connected thyristors during furnace transformer and Harmonic Filter (HF) energization periods. However in conventional C-type 2nd HFs there is only one damping resistor, which is permanently connected to the filter circuit. In conventional designs, either the filtering performance is maximized or transient overvoltage suppression capability is enhanced or a compromise is made between these two objectives. This new configuration of C-type 2nd HF has been applied to a sample iron and steel plant in which two LFs are in operation. For this purpose, an SVC system has been designed and installed which is composed of a thyristor controlled reactor, a 3rd HF and the new C-type 2nd HF configuration proposed in the paper. The results of field tests and simulation studies show that the proposed C-type 2nd HF configuration gives much better results than conventional designs.