A recently proposed method for stabilizing haptic interfaces and teleoperation systems was tested with a "PHANToM" commercial haptic device. The "Passivity Observer" (PO) and "Passivity Controller" (PC) stabilization method was formed to stabilize the system but also excite high frequency mode in the device. To solve this problem, we propose a method to use a time-varying desired energy threshold instead of fixed zero energy threshold for the PO, and make the actual energy input follow the time-varying energy threshold. With the time-varying energy threshold, we make the PC control action smooth without sudden impulsive behavior by distributing the dissipation. The proposed new PO/PC approach is applied to PHANToM with high stiffness (K = 500N/m), and stable and smooth contact is guarantee. Resetting and active environment display problems also can be solved with the reference energy following idea.