One application of turbo-expanders is in the natural gas pressure reduction at city gates gas regulating stations, in place of mechanical valves. Besides, they can drive electrical generators, but, because of instantaneous varying of domestic consumptions, environment temperature and other effective parameters, turbo-expander inlet gas pressure and mass flow-rate vary with time and consequently extracted power has time variant specification. These variations are transferred by coupled generator to the power distribution network and cause some power quality issues such as voltage flicker, voltage sag, etc. So, we need to assess the amount of flicker and voltage sag at the point of common coupling (PCC). Moreover, it is essential to investigate turbo-expander-gearbox-generator stability behavior when a fault has occurred in the power network. Thus, this paper presents a modular model for turbo-expander driven generators in power system studies. Using this model, we show the produced power quality is dependant on inlet gas specifications. Also it is proven that proper modeling of shaft is critical to transient stability study of this system. In addition, the inlet mass flow-rate and inlet pressure variation can produce torsional oscillation on the shaft. Copyright © 2009 Institute of Electrical Engineers of Japan. Published by John Wiley & Sons, Inc.