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An alternative to real-time simulation for hardware-in-the-loop testing is proposed. This involves system simulation, not necessarily done in real time, and real-time playback of the simulated output to the controller under test. The time-stamped controller output is stored and subsequently fed as an input to the simulation. This whole process is done iteratively as in the Waveform Relaxation method, till the waveforms converge. This method can be used for testing multiple and dispersed controller hardware and the associated communication equipment, e.g., wide-area measurement based control and system protection schemes. It also has the potential to be an alternative to real-time simulators which are expensive when large systems have to be simulated. The basic scheme and potential applications are discussed in this paper.