Rapid consumption of energy from conventional sources can be limited by connecting more no. of distributed generation systems with the support of smart grid technology. But the impact of variation in DG power out putted may lead to power quality problems in the distributed system in which it is connected. In addition to this power system faults, non-linear loads and non-linear characteristics of converter circuits used in DG s further deteriorate quality of the power. Implementation of UPQC in the network itself solves the problems addressed but crowding of more no of DG in the network will suppress the effect of UPQC. However energy storage system integration can suppress the large power fluctuations outputted by DGs. In this paper energy storage based unified power quality conditioner (EUPQC) has been implemented using fuggy logic controller. For energy storage ultra (Super) capacitor has been used for fast rate of charging and discharging. The performance of the implemented UPQC with fuggy logic controller is compared with PI controller with the MATLAB simulation.