Electric power systems with substantial wind capacity require additional flexibility to react to rapid changes in wind farm output and mismatches in the timing of generation and demand. Controlled variable-rate charging of plug-in electric vehicles allows demand to be rapidly modulated, providing an alternative to using fast-responding natural gas plants for balancing supply with demand and potentially reducing costs of operation and new plant construction. We investigate the cost savings from controlled charging of electric vehicles, the extent to which these benefits increase in high wind penetration scenarios, and the trade-off between establishing a controlled charging program vs. increasing the capacity of generators in the power system. We construct a mixed integer linear programming model for capacity expansion, plant dispatch, and plug-in hybrid electric vehicle (PHEV) charging based on the NYISO system. We find that controlled charging cuts the cost of integrating PHEVs in half. The magnitude of these savings is similar to 5% to 15% higher in a system with 20% wind penetration compared to a system with no wind power, and the savings are 50-60% higher in a system that requires capacity expansion. (C) 2013 Elsevier Ltd. All rights reserved.