Abstract: On 1st December 2017, the world's largest 100MW/129MWh lithium battery storage power station from Tesla was put into operation in South Australia. Then in 14th December 2017 and 18th January 2018, Tesla storage battery participated in grid frequency recovery after Victorian Loy Yang power station unit tripping accident. Tesla was triggered 140ms after the accident, before injecting active power to the grid. As a result, grid frequency was back to 50Hz with the help of Tesla and other contracted large coal-fired generators within 6 minutes. Operation of the Tesla storage program to date suggests that it can provide a range of valuable power system services, including rapid, accurate frequency response and control. Up to now, Tesla power station has provided auxiliary services such as regular adjustment and output, energy output and emergency output to the power grid. Battery storage also has the potential to stop gaming of prices in the wholesale market. The introduction of the battery and demand-side response has worked to drive down frequency control ancillary services markets by 57 per cent below than the final quarter of 2017. For example, in quarter 1 2018, Australian frequency control ancillary service costs were 25 million, representing a 32.7 million (57%) decrease on quarter 4 2017 levels. Also, with the big battery in the mix and breaking the gas market cartel, average Raise and Lower Regulation prices were just 248/MWh during the January 14 event. This paper first analyzes the physical and economic reasons why Tesla storage battery is integrated into Australia power grid. The 100MW/129MWh Tesla big battery, officially known as the Hornsdale Power Reserve, was officially switched on in December 1, with 70MW providing network security for the grid operator, and another 30MW operating energy arbitrage in wholesale markets. A number of figures are shown to illustrate how the battery was used in the frequency control and ancillary services market, providing a much more accurate response than conventional generators, and a much faster response. Besides, the paper also provides unique insight into the battery’s own performance, its ability to slash prices by breaking open the gas cartel that controlled prices in specialised markets such as grid services, and how it helped keep the lights on and reshape thinking about grid operations. Then the structure and control strategy of battery is introduced. The operation of energy storage is introduced from both physical and economic dimensions. Later on, energy storage grid related technical standards and evaluation hierarchy are suggested to be made. Leverage effect which is applied in primary frequency regulation is proposed. New type of ancillary service is developed and storage’s profit making mode is explored. At present, China lacks a primary frequency modulation ancillary service market. The primary frequency regulation of power plant is still evaluated by the power grid as a basic service. As a new type of power supply with inertial response and primary frequency regulation, energy storage still lacks the opportunity to gain value in ancillary service market. Therefore, China can learn from the foreign market regulation of frequency regulation ancillary services, and incorporate fast frequency regulation capabilities into ancillary services. All above proposals are lessons that China should learn to develop its storage technologies and storage-grid integration technologies. Last but not least, the reliability of the energy storage battery in the high and cold regions, the allocation