The energy storage system (ESS) is an effective means of power demand side management (DSM) and control of load variation for its time shift capability with respect to power and energy. This paper presents an objective function of ESS net present value (NPV) composed of factors of the initial investment capital

operation and maintenance costs

equipments replacement costs and capital gains. A model based on equivalent life loss for calculating the battery life and an improved strategy for ESS charge/discharge is proposed

which is used for estimating the life of ESS with irregular cycles and determining the start-stop time of ESS charge/discharge

respectively. To speed up the calculation for achieving the global optimal solution

a scheme of quantum coding combined with self-adapting GA is adopted and cataclysm is introduced. A case study is made in terms of NPV for analyzing the economic benefits of three kinds of ESS

i.e. lithium-ion

lead-acid and sodium-sulfur. Based on boundary conditions set up in this paper

the experimental results show that sodium-sulfur ESS applied on the power demand side brings better economic benefits than the other two. This work is supported by National High Technology Research and Development Program of China (863 Program) (No. 2012AA050217) and Specialized Research Fund for the Doctoral Program of Higher Education (SRFDP) of China (No. 20110008110042).