Conventional generation systems, made from wound rotor synchronous generator, have limited possibility to further improvement. The demand of precise fixed speed does not permit to any reduction in mass and quality of produced voltage. The paper presents adjustable/variable speed generation system producing sinusoidal AC voltage. The system consist of driving engine, permanent magnet generator and power electronic converter. The axial flux permanent magnet generator produces AC variable frequency and amplitude whereas an AC/AC. power electronic converter provides quality standard voltage. The paper presents basic relations in the new generation system. An axial flux permanent magnet generator 16 poles generator is used. The system operates in wide speed range and speed variability may be applied for efficient operation.