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It is expected that dispersed generation (DG) will play an increasing role in electric power systems in the near future. Among the benefits that DG can give to the power system operators and to the electricity customers, one of the most attractive is the possibility of improving the continuity of power supply. DG plants can be designed to supply portions of the distribution grid in the event of an upstream supply outage. Techniques for controlling DG plants that use feedback of only locally measurable variables are presented. This solution allows correct system operation and switching between parallel and isolated modes without needing online communication of control signals between the generators. The control technique is described with particular reference to inverter-interfaced systems (micro-turbines, fuel cells). Simulations of sample cases including different size and type of generators are presented.