This paper studies various operational aspects ofrecursive least square algorithm as a potential solution for theestimation of short circuit capacity in HVDC application. Inthis work, low computational requirement, minor operationalcomplication and acceptable accuracy of the estimated gridparameters have been considered as the performance metricsfor the selection of the suitable estimation algorithm. The chosenalgorithm forms a regression problem using at least two algebraiccomplex equations based on two different operating points. Theappropriate selection of the second operating point which fulfillsthe minimum required accuracy and convergence rate is of greatimportance, particularly in the practical implementation. Thispaper proposes and analyzes several choices of providing thesecond operating point for the estimation algorithm adopted toHVDC application. Furthermore, a sensitivity analysis has beencarried out to assess the impact of different parameters andoperational conditions such as execution time on the performanceof the estimation algorithm for the HVDC control purposes.