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Wind is a variable and uncontrollable source of power with a low capacity factor. Using energy storage facilities with a non-firm connection strategy is the key to maximum integration of distant wind farms into a transmission-constrained power system. In this paper, we explore the application of energy storage in optimal allocation of wind capacity to a power system from distant wind sites. Energy storage decreases transmission connection requirements, smoothes the wind farm output and decreases the wind energy curtailments in a non-firm wind capacity allocation strategy. Specifically, we examine the use of compressed air energy storage (CABS) technology to supplement wind farms and downsize the transmission connection requirements. Benders decomposition approach is applied to decompose this computationally challenging and large-scale mixed-integer linear programming (MILP) into smaller problems. The simulation results show that using energy storage systems can decrease the variation of wind farms output as well as the total cost, including investment and operation costs, and increase the wind energy penetration into the power system. (C) 2013 Elsevier Ltd. All rights reserved.