This paper provides a comprehensive study on the deployment of the retired PHEV battery in residential microgrid. Firstly, an Energy Management Strategy (EMS) is proposed, which is able to size the Distributed Energy Resource (DER) and determine the optimal usage profile of the Local Energy Storage (LES) unit in the residential microgrid. Then, a probabilistic household load modeling method is developed and utilized in the EMS to extend its applicable range. Afterward, a flexible experimental platform for the study on the integration of the battery pack in residential microgrid is configured. Design and configuration considerations for this platform are presented, and experimental results are shown.