In this study, a double-loop control strategy is proposed for power grid frequency and voltage regulation using plug-in electric vehicles (PEVs) connected to the grid through a three-level capacitor clamped inverter. The frequency and voltage regulation problem is first formulated using vector space analysis and phasor diagrams to find the boundaries and constraints in terms of the system parameters. The derived formulas are then utilized to design a double-loop controller using an exclusive phase detector control loop and a novel pulse width modulation (PWM) scheme to effectively regulate the frequency and voltage of the grid. The effectiveness and feasibility of the proposed control strategy are evaluated through simulation and experimental studies. This approach can benefit both the customers and the grid operator, as it facilitates utilizing the batteries of the connected PEVs to supply a portion or all of the active and reactive power demand, hence regulating the frequency and voltage of the grid. The extent to which active and reactive power can be supplied depends on the number of PEVs connected to the local grid.