This paper presents a control strategy for the hybrid wind diesel with battery storage in isolated network. The proposed strategy consists of dc/dc bidirectional converter for charging/discharging battery to keep the frequency at the PCC constant by consuming/providing the extra active power delivered by the wind turbine. The battery is also used to feed the loads when the speed of the wind is too low to improve the efficiency of the installation by reducing the power delivered by the diesel engine. The control technique known as pq theory is used to control the interfacing inverter to perform the desired tasks. The proposed use of strategy compensates the current harmonics, the reactive power and the unbalance load. The entire system is realized and simulated in MATLAB/SPS environment. The results under various conditions are presented and discussed. Index Terms-HPESWD (high penetration with energy storage wind diesel), Energy storage, Shunt active filter (AF), Instantaneous power theory, power quality, THD (Total Harmonic Distorsion).