Surge arresters are primarily used to discharge lightning strikes and switching surges to ground – protecting equipment in the process. Note that arresters are not applied to relieve the system from temporary over-voltages.
Air has a dielectric strength of 33kV/cm. SF6 gas, on the other hand, has a dielectric strength of ~83kV/cm. Naturally, when the live parts are immersed in a pressurized gas chamber they can be placed a lot closer.
Capacitors consume active power and release reactive power. They also present a low impedance to harmonics in other words they attract harmonic frequencies. Thus, capacitor banks are installed in substations to: