A major requirement in the application of FACTS devices in power systems is to develop techniques which enable system planners to manage with great confidence the uncertainty associated with these devices. This paper presents an approach to evaluate transmission system reliability when employing a unified power flow controller (UPFC). This paper provides a framework within which the risk associated with management and the development of the transmission network can be quantified. Reliability indices such as the loss of load probability (LOLP), loss of load expectation (LOLE), the loss of energy expectation (LOEE) and the system minutes (SM) are utilized to examine the impact of UPFC on the transmission system reliability. The technique is illustrated by application to a hypothetical system.