abstract: With growing concern regarding environmental issues and the need for a more sustainable grid, power systems have seen a fast expansion of renewable resources in the last decade. The uncertainty and variability of renewable resources has posed new challenges on system operators. Due to its energy-shifting and fast-ramping capabilities, energy storage (ES) has been considered as an attractive solution to alleviate the increased renewable uncertainty and variability. In this dissertation, stochastic optimization is utilized to evaluate the benefit of bulk energy storage to facilitate the integration of high levels of renewable resources in transmission systems. A cost-benefit analysis is performed to study the cost-effectiveness of energy storage. A two-step approach is developed to analyze the effectiveness of using energy storage to provide ancillary services. Results show that as renewable penetrations increase, energy storage can effectively compensate for the variability and uncertainty in renewable energy and has increasing benefits to the system. With increased renewable penetrations, enhanced dispatch models are needed to efficiently operate energy storage. As existing approaches do not fully utilize the flexibility of energy storage, two approaches are developed in this dissertation to improve the operational strategy of energy storage. The first approach is developed using stochastic programming techniques. A stochastic unit commitment (UC) is solved to obtain schedules for energy storage with different renewable scenarios. Operating policies are then constructed using the solutions from the stochastic UC to efficiently operate energy storage across multiple time periods. The second approach is a policy function approach. By incorporating an offline analysis stage prior to the actual operating stage, the patterns between the system operating conditions and the optimal actions for energy storage are identified using a data mining model. The obtained data mining model is then used in real-time to provide enhancement to a deterministic economic dispatch model and improve the utilization of energy storage. Results show that the policy function approach outperforms a traditional approach where a schedule determined and fixed at a prior look-ahead stage is used. The policy function approach is also shown to have minimal added computational difficulty to the real-time market. / Dissertation/Thesis / Doctoral Dissertation Engineering 2016