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This paper presents a centralized control system that coordinates parallel operations of different distributed generation (DG) inverters within a microgrid. The control design for the DG inverters employs a new Model Predictive Control algorithm that allows faster computational time for large power systems by optimizing the steady-state and the transient control problems separately. An overall energy management system is also implemented for the microgrid to coordinate load sharing among different DG units during both grid-connected and islanded operations. The design concept of the proposed control system is evaluated through simulation studies under different test scenarios. The impact of the increased penetration of DG units on the distribution grid is also investigated using the proposed microgrid. The simulation results show that the operations of the DG units within the microgrid can be coordinated effectively under the proposed control system to ensure stable operation of the overall microgrid.