This paper introduces a new waveform coding technique, based on wavelet transform, for power quality monitoring purposes. The proposed enhanced data compression method (EDCM) presents a complete adaptive signal processing approach to estimate the fundamental sinusoidal component and separate it from the transient ones in the monitored signal. When these nonstationary components are submitted to the compression technique, the sparse representation property of the wavelet transform provides an improvement in the compression ratio. Also, the degradation inserted by the lossy compression process is minimized. Simulation results confirm the effectiveness of the proposed method when compared to the standard solution, characterized by the compression of the whole monitored signal.192464471