A method and associated system provide grid-forming mode (GFM) control of an inverter-based renewable energy source having an asynchronous machine connected to a power grid. The method includes deriving a power error signal (PER) between a real power output (PB) from the renewable energy source and a power reference (PREF) representing a desired power output of the renewable energy source. With an inertial power regulator, a phase shift angle (δIT) is generated from the power error signal (PER) to provide virtual synchronous machine (VSM) control functionality to the GFM control of the renewable energy source. A power angle compensation (Δδ) is applied to the phase shift angle (δIT) from the inertial power regulator to dampen power oscillations and load fluctuations during transient power events.