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The modular multilevel converter (MMC) is an emerging and attractive topology for the high-voltage direct-current (HVDC) transmission system. This paper presents a generalized mathematical model for MMC in HVDC applications under balanced and unbalanced grid conditions. The dynamics of the positive-, negative-, and zero-sequence components are derived from the model. Then, a dual current control scheme with positive- and negative-sequence current controllers is applied to MMC. The power controller to eliminate negative-sequence current components and the other one to eliminate double-line-frequency voltage ripple are compared. Moreover, a zero-sequence current controller is proposed in addition to the positive- and negative-sequence current controllers. Time-domain simulations on a 61-level MMC-HVDC test system are performed in the PSCAD/EMTDC software environment. The results demonstrate that the MMC-HVDC system with or without converter transformer is able to operate under unbalanced conditions by the use of the proposed control scheme.