This paper presents the development, implementation and performance testing of a new permanent magnet generator-based wind energy conversion system for grid-connected applications. The grid-connected operation is constructed using the new three phase resolution-level controlled wavelet modulated inverter. The output of the wind generator is fed to a switch-mode converter, where the dc voltage is controlled to ensure extracting the maximum power at each wind speed. The resolution-level control of the grid-side inverter is designed as a current controller for adjusting active and reactive powers delivered to the grid. The proposed wind energy conversion system is implemented both in software and hardware performance testing on a direct-drive 6 kW laboratory permanent magnet generator operated with variable speed. Test results demonstrate that an accurate control of the dc voltage on the generator side ensures adjusting the generator speed to extract the maximum power from the wind at each wind speed. Also, test results show significant abilities of the resolution-level controller to initiate fast and accurate adjustments in the output active and reactive powers to meet the demand values under variable wind speed.