This thesis investigates the long-term optimal scheduling algorithm proposed for the energy storage system, to better organize charging/discharging action of battery for the economic operation in a PV grid-connected household nano-grid system. To fulfill this goal, the household nano-grid is modeled, including PV module, energy storage system, DC/AC inverter and their corresponding controllers. Battery is used to execute the optimal power command scheduled by long-term optimal scheduling algorithm. The optimal power scheduling algorithm is based on the rolling optimization method, which can realize the minimum operational cost of the PV nano-grid system. Moreover, a smoothing function is introduced to alleviate the power fluctuation of the exchanging power between PV nanogrid system and the main power grid caused by PV and residential loads. The validity of the proposed energy management strategy in upper Energy Management System (EMS) has been examined using simulations in MATLAB/Simpower. iii Acknowledgements I would first like to express my sincere gratitude to my Professor Xiaoyu Wang for his suggestion, instruction and guidance of my Master study and research. His invaluable guidance, constant encouragement inspires me a lot when I was troubled with difficulties. Without his continuous support and care, it would have not been possible to complete this thesis. I would also show my warm thank to the colleagues in my research group: