In traditional grid inertia and frequency stability evaluation, the inertia contribution of the asynchronous motor load in the power plant is ignored. This may lead to deviations in the evaluation results. Given this, a method for estimating the inertia correction of power plants under normal conditions and considering the contribution of rotating load is studied. The power plant and the internal motor load are equivalent to a whole, and the equivalent inertia of the power plant is estimated by using the active/frequency normalized small disturbance data of the export bus. Noting the characteristic that the equivalent inertia of the power plant is a fast time-varying parameter, a controlled autoregressive model and a recursive least squares identification algorithm based on a variable forgetting factor are proposed to estimate the inertia parameters. The verification results of a test system show that the proposed identification model has high accuracy and can adapt to the parameter identification of small disturbance input/output data. When considering the inertia contribution of the rotating load, there are differences between the equivalent inertia of the power plant and the equivalent inertia of the system. Also they have time-varying characteristics, and the obtained modified inertia can more objectively evaluate the inertia of the power plant and the system inertia. This work is supported by the National Natural Science Foundation of China (No. 51907104).