During lightning or switching in power system substation, particularly in the Gas Insulated Substations, very fast transient oscillations may take place. Transformers can be exposed to severe transient overvoltages, which may propagate inside windings and damage the transformer. Substation grounding impedance in this case cannot be considered as negligible. Mutual inductances and capacitances between grounding bars during transients causing high frequency phenomena cannot be neglected, and may significantly increase the total grounding impedance, which results in an increased arrester's residual voltage. Therefore, it is very important to perform detailed analysis by consideration of the frequency dependence of the grounding grid and accurate high frequency modeling of the surrounding components like transformers, surge arresters and lines. This article deals with the methodology of the component modeling and presents a method to interface the grounding grid to the system. Finally, an example is presented which demonstrates the importance of this analysis for efficient overvoltage protection during fast transient events.