Abstract: A new algorithm is proposed to detect and extract in real-time signals with fundamental and harmonic wave components in the power grid, which is applicable to power measurement. The proposed method is based on the concept of adaptive filter, and adaptively decomposes the measured power signal into its constituting components, resulting in a fast convergence rate. The fundamental and harmonic wave components in the power grid can be decomposed into a series of sinusoidal signals. The frequency of the power grid is measured by energy operator. A model of voltage and current wave in the power grid is constructed, a new step-size LMS algorithm for improving the adaptive filter is proposed and the stability of the proposed method is discussed. The effectiveness of the proposed method is demonstrated by simulation examples.