The utility-scale renewables, PV and wind, are already approaching grid parity. To further enhance their penetration rapidly requires additional cost reduction and increased efficiency. There are other applications in utility-scale energy storage systems and in substations with power ratings in MW range for rapid charging of multiple electric vehicles. Towards this goal, one approach to interface with grid voltages of up to 34.5 kV is to use Power Electronic Transformers (PETs) consisting of back-to-back MMCs (Modular Multilevel Converters) and a high-frequency transformer. The control in such systems is challenging because of the lack of significant energy storage in the dc link between the two MMCs, unlike those in applications such as HVDC transmission and medium-voltage motor drives. Constraints on the modulation scheme under such conditions are pointed out and a novel control scheme is proposed in this paper that results in a ripple-free voltage dc link voltage, but controllable, between the two MMCs, reduced ripple in the capacitor voltages in each MMC module, and low THD in the ac currents at the terminals of the MMCs. Using this control scheme, the operation at controllable power factor and under unbalanced grid conditions is investigated and the simulation results are presented.