Abstract The paper presents original methods and algorithms of measurement of power quality parameters which were implemented in a new measurement device called an estimator-analyzer of power quality. The main idea was to overcome the shortcomings of current power quality analyzers, namely sensitivity to fast fluctuations of input signal parameters. This was attained with regard to the algorithm’s overall computational complexity. Complementary application of discrete wavelet transform (DWT) with Fourier transforms and chirp z-transform (CZT) was proposed for the aim. Next, a new concept of estimator mode was devised. It consists in multistage signal processing and applied methods depending on input signal character – its frequency and existing waveform distortions – as well as the chosen set of reference parameters. It further improves device performance in terms of time of computation. Description of the estimator-analyzer hardware and results of experimental research will be presented in the second part of the paper.