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In this paper, the interactions of the torsional dynamics of the wind turbines and power modulation for oscillations in DFIG-based wind generators are investigated. One major concern of active power modulation is its interaction with wind turbine's torsional dynamics. A study case with wind turbine torsional dynamics modeled is derived from our earlier work. Both active power modulation and reactive power modulation controls are developed in this paper. The paper successfully demonstrates the presence of interaction between active power modulation and torsional dynamics and the absence of such interaction in the case of reactive power modulation. Linear system analysis and root loci approach are employed to demonstrate such interaction. Simulation results in MATLAB/Simulink further verifies the analysis. The major contribution of this paper is: 1) the demonstration of the potential disadvantage of wind generation's active power modulation; and 2) the identification of reactive power modulation in wind generation as an alternative for interarea oscillation damping.