A method for controlling a network of inverter-based resources connected to a power grid during a disturbance includes employing a distributed transient virtual impedance algorithm among the network of inverter-based resources (IBRs) after a start of or in anticipation of the disturbance. The distributed transient virtual impedance algorithm includes determining, via at least one of one or more power flow equations, one or more energy function equations, and one or more estimated power capabilities, a virtual impedance control parameter and a modified power reference for one or more of the IBRs. Further, the method includes activating the virtual impedance control parameter and the modified power reference for one or more of the IBRs to ride through the disturbance in a manner that also optimizes use of the one or more estimated power capabilities for one or more of the IBRs and that preserves synchronism between at least two of the inverter-based resources and/or between at least one of the inverter-based resources and the power grid. Thus, the virtual impedance control parameter temporarily reduces voltage proportionally with output current for one or more of the IBRs, thereby resulting in a reduction of local power output of one or more of the IBRs.