Optimal Operation of Battery Energy Storage Systems in Microgrid-Connected Distribution Networks for Economic Efficiency and Grid Security

The increasing penetration of microgrids (MGs) in modern power distribution systems requires advanced operational strategies to ensure both economic efficiency and technical reliability. This study developed an optimal economic framework for battery energy storage in MG connected to distribution systems in order to minimize operational costs while considering renewable integration and battery charging and discharging cost and degradation cost as well, and their impact on grid technical constraint. An MG is interconnected to the IEEE-33 radial distribution feeder through an additional bus, where the BESS operates to minimize the total operating cost over a 24 h horizon. The formulation captures the charging and discharging dynamics of the BESS, BESS degradation, state-of-charge constraints, electricity price signals, and the network’s operational limits. The optimization problem is solved using Mixed Integer Linear Program (MILP) to obtain the optimal scheduling of BESS charging and discharging which minimizes the total operating cost and maintains grid constraint within the allowable limit by optimizing the power exchange between the MG and the distribution grid. Simulation results showed that the proposed approach reduces operational costs and optimize grid power exchange, while maintaining technical reliability of the distribution system by enhancing its voltage profiles, improving its feeder loading capability, and reducing the system losses. This study provides a practical tool for enhancing both economic and technical performance in MG-connected distribution systems.