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Three-phase self-excited induction generators (SEIG) play an important rule in renewable energy sources such as wind and hydraulic energy. Their main disadvantage is poor voltage and frequency regulation under varying load and speed. This paper introduces a new and simple method for voltage and frequency control of three-phase unregulated speed induction generators in the islanding mode. The method uses a constant voltage constant frequency (CVCF) PWM converter without regulating the DC capacitor voltage. The capacitor voltage is left changing with the loading conditions and the AC side voltage is regulated by controlling the modulation index. This eliminates the need of an auxiliary switch in the DC side which reduces the cost and also reduces the high frequency current components flowing in the DC capacitor and that increases its life time. The proposed technique is tested under step changes in load and prime mover speed. The proposed technique gives the same response as the old technique but without the use of DC side switch.