With the raise of energy cost, every country proposes many strategies to search for alternative energy. This trend makes the microgrid system with distributed energy sources more attractive. Distributed energy resources can reduce the investment cost of building new fossil-fuel based power plant, mitigate the carbon oxide reduction, provide reactive power compensation and frequency regulation, increase the spin reserve, and enhance the system stability. However, some undesired effects are accompanied with their installations and operations, such as imbalance, voltage regulation, voltage fluctuation, and harmonics, as well as interharmonics.To effectively estimate the power quality of systems, a simple and accurate analysis method is important. Due to the development of fast Fourier transform (FFT) for efficient computation of discrete Fourier transform (DFT), digital measuring techniques have been greatly promoted since 1960s. Therefore, FFT has been widely used in the fields of communication, acoustics, videos, and control. However, since there are several limitations in FFT, direct usage of this technique would lead to significant estimation errors.Because those power quality analysis methods are quite different and have different limitations for different power signals, inexperienced engineers may not be able to effectively and correctly apply these techniques. Hence, several commonly used methods will be reviewed and compared in this project, and a suitable combined measuring system and system simulations will also be proposed to enhance power quality control and provide some strategies for remedy of power quality in AC microgrid of Institute of Nuclear Energy Research (INER).From above, the main tasks of this project can be summarized, which include: (1) Review and compare the recent power quality signal processing methods; (2) Implement reviewed methods and make comparisons of performance; (3)Design and implement the power monitoring and protection system based on INER microgrid according to the proposed designing rules and IEC standards; (4) Make the measurements and analysis for the actual disturbance sources with the developed microgrid power monitoring and protection system; (5) Establish and design the related database for the power quality signal measurements; (6) Propose the remedial strategies to enhance the power quality of INER microgrid.