Abstract: To research the negative sequence compensation and regenerative braking energy recovery and utilization of traction power supply system under the condition of unbalanced grid voltage in remote areas, based on the energy storage type railway power conditioner, this paper proposes a regenerative braking energy utilization and negative sequence comprehensive compensation optimization strategy that takes into account the grid voltage imbalance condition when the capacity of the compensation device is limited. When the grid voltage is unbalanced, the complete compensation mechanism of negative sequence of the energy storage type railway power conditioner is analyzed, and the compensation coefficients of active and reactive current and the energy storage system are introduced. Negative sequence compensation degree, the compensation capacity of the traction substation and the load balance of the power supply arm are taken as the optimization targets, and an optimal compensation model for the energy storage type railway power conditioner is proposed. The optimization model is solved by the sequential quadratic programming method, and finally it is verified by simulation. It is revealed that this strategy can reduce the negative sequence imbalance on the grid side while increasing the utilization rate of regenerative braking energy when the grid voltage is unbalanced, and can reduce the energy demand of traction load on the traction substation.