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This paper presents design and implementation of a 5-kW single-phase bidirectional inverter with wide inductance variation. For dc-microgrid applications, the bidirectional inverter has to fulfill grid connection and rectification with power factor correction to regulate the dc bus to a certain range of voltages. In the inverter operation, inductor current can vary from 0 to 32 A in one line cycle. This will result in wide inductance variation, around seven times for an inductor constructed with a molybdenum permalloy powder core, and thus, high current ripple and fluctuation. In this paper, we take into account this variation while designing controller and selecting key components to ensure inverter normal operation. Additionally, to adopt a cost-effective microcontroller for the inverter, the sensitivities of the control to various parameters are investigated and presented in this paper. Experimental results measured from a 5-kW single-phase prototype have verified the feasibility of the designed inverter.