This paper presents a new simple approach for computing the minimum value of capacitance necessary to initiate the self excitation process in three-phase isolated induction generators. The method proposed in this paper is based on the analysis of the complex impedance matrix of the induction generator when loaded with a general inductive load. The advantage of this method is its simplicity since it involves simple algebraic equations and only one equation is solved iteratively to get the value of minimum capacitance. A simple computer algorithm has been developed to predict the minimum value of capacitance necessary for the onset of self-excitation. Using the same approach the algorithm is modified to predict the minimum value of capacitance necessary to maintain the generator terminal voltage at a preset value under specific load and speed conditions. The computer simulations obtained using the proposed method are compared with those obtained experimentally to confirm the validity and accuracy of the proposed method.