Conventional Optimal Power Flow (OPF) minimizes line loss snapshot by controlling generation output and transformer tap position. Distributed energy storage system (DESS) that locates close to load can provide more flexible and effective control to reduce overall line loss. A dynamic optimal power flow (DOPF) method considering energy storage units is adopted to model and analyze line loss reduction by DESS. Tests are performed to validate the DOPF model and show the effectiveness of line loss reduction by DESS. © 2012 IEEE.