Through the establishment of multi flicker sources circuit equivalent model, the theoretical background of tracing flicker sources by flicker power was analyzed. To accurately estimate flicker power, the flicker envelope parameters were obtained by using improved Teager Kaiser energy operator and the improved FFT. The direction of flicker flow was determined by the sign of flicker power, and pollution assessment was achieved with the magnitude of flicker power. The simulation analysis and experiment results show that this approach can trace flicker sources effectively and rapidly and assess the pollution level of different flicker sources accurately. The tracing results are computed fast and correctly and the misdiagnosis rate is reduced.