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As a result of many factors, including the European Union's aim to increase the share of electrical energy from renewable sources, the number of distributed-generation (DG) devices in Europe is significantly increasing. Increasing numbers of DG units may cause problems with power quality (PQ). In this paper, a PQ-management algorithm is presented that reduces or even solves this problem in low-voltage grids. This algorithm will be implemented as one of several software modules in a system for distributed power operation and PQ management in low-voltage grids. PQ management in this context means maintaining PQ within prescribed limits by optimizing the control of generators, storage units, and controllable loads. Significant advantages of the presented approach are that the algorithm is universal and that it adapts its control variables automatically. Therefore, a detailed analysis of the grid in advance is not necessary. Furthermore, local PQ control of distributed resources can work autonomously and continuously without triggering by external signals, which is advantageous in the case of loss of communications. Various simulations to validate the effectiveness and stable operation of the algorithm were performed and results presented that show a marked improvement in PQ. [ABSTRACT FROM AUTHOR]