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A novel two stage multi-objective control strategy for optimal voltage unbalance compensation in low voltage microgrid systems consisting of inverter interfaced distributed generators (IIDGs) has been presented in this research. To ensure continuous and safe operation of the IIDGs during unbalanced voltage sags, the proposed control strategy supplies the optimal positive sequence voltage support and performs voltage unbalance compensation considering the current limitation of the inverters. The control strategy also ensures that the DGs deliver maximum allowable active power during voltage sag. The positive and negative sequence quantities of the IIDGs are controlled in such a way so that these objectives can be achieved simultaneously. The DGs are operated in coordination with each other to maintain the voltage profile as desired by the grid operator. Prioritisation of active power and unbalance compensation can be set depending upon the requirement of the customer. Under severe grid imbalance condition, the proposed technique can raise the positive sequence voltage to near nominal value from below 0.9 per unit maintaining all phase currents of DGs within safety limit.To solve the optimization problem and to generate the optimal references for the DG control unit, artificial cooperative search algorithm has been utilised. The two stage control strategy includes a local control for each DG, which coordinates with the central control to provide the optimal references for all the DGs. The multi-objective control strategy has been tested under different operating conditions and implemented in real time digital simulator to ensure the robustness and effectiveness of the proposed approach. [ABSTRACT FROM AUTHOR]