The squirrel-cage induction machine is very attractive for small and medium power generation schemes because of its low cost, robustness and high power density (W/kg). However, the magnitude and the frequency of the generated voltage depend upon the rotor speed, the amount of capacitive excitation, and the load in stand-alone systems with unregulated prime movers. A common approach for providing regulated voltage and frequency to the load is the use of an asynchronous link (ac-dc-ac) power electronic converter. The main disadvantage of this scheme is that the two series connected ac-dc converters have to be rated at least to the rated generator output power. This work investigates the use of a VSI with induction generator operating with an unregulated prime mover supplying power to a load with regulated voltage and frequency in stand alone mode.