This paper introduces cooperative operation of the unified power quality conditioner (UPQC) with the energy storage system. The proposed system consists of a series inverter, a shunt inverter, and super-capacitors as energy storage devices connected in the dc link through the DC-DC converter. The proposed UPQC can compensate the reactive power, harmonic current, voltage sag and swell, voltage unbalance, and the voltage interruption. A numerical formulation of the proposed control schemes, which are based on the instantaneous power theory, is presented. The performance of proposed system is analyzed through simulations with MATLAB\SIMULINK software. The proposed system can improve the power quality at the common connection point of the non-linear load and the sensitive load.