What device should be used to protect a system from over voltage and power spikes caused by dramatic fluctuations in electrical power levels?

The device that you are looking for is called a surge suppressor. It is a small device that can be mounted in one of the knock out holes in the distribution panel. They are a four wire device. It should be connected across a common tie double pole breaker. The two black leads from the suppressor connect to each of the terminals of the two pole breaker. The third white lead connects to the neutral bar of the distribution panel. The forth green wire connects to the ground buss, (not to be confused with the neutral bus). With the breaker turned on it continuously monitors the voltage of the distribution panel and automatically sends power spikes to ground.