With the increasing integration of renewable energy, the problems associated with a deteriorating grid frequency profile and potential power system instability have become more significant. In this paper, the inertial control algorithm using a virtual synchronous generator (VSG) is implemented on a Type 4 permanent magnet synchronous generator (PMSG) wind turbine generator (WTG). The overall nonlinear dynamic model and its small-signal linearization of the PMSG-WTG using a VSG is established and comprehensively analyzed. Inevitably, the direct application of the VSG introduces a large inertia, which causes conflict between the fast variance of available wind power and inverter control with slow dynamics, particularly in Region 2 of the wind turbine. Aiming to address such issues, a VSG with multiple virtual rotating masses is proposed to improve the active power tracking performance as well as to boost the inertial control of a VSG. The inertial responses are verified in a modified 10-MVA IEEE 14-bus microgrid system. The assessment of the simulation results demonstrates the applicability of the VSG on renewable energy generation units.