Mbrooke,
You can do the exact same thing with voltage and current vectors and impedance drop to show how and why capacitor banks raise system voltage. The basic idea though is that imaginary lagging current causes the greatest magnitude voltaage drop across reactance due to it being in line the the voltage vector. Leading current causes a voltage rise across an inductor because it is inline with the voltage but in the opposite direction. Transmission lines show the same issue with the magnitude voltage drop being related to the PF of the power traveling along it.
So if someone ask why capacitors increase system voltage, you can tell them that it reduces the magnitude of the current needed deliver vars to the load and it reduces the amount of lagging current in the system and thereby reduces the voltage drop across the transmission line reactances.
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If you can't explain it to a six year old, you don't understand it yourself.