A method of for estimating the reliability of new conceptual stand-alone dispersed power supply systems using AC modules with self-contained logic was proposed and system reliability estimated using a yearly scale simulation. The AC module is able to supply AC power on each module and has the flexibility to enable construction of a grid-connected system. Power storage devices were required when applying AC modules to the stand-alone power supply system. For these power storage devices, we used a battery with a built-in DC/AC micro bi-directional inverter known as AC battery. To maintain the flexibility of the system extension, the AC modules and AC batteries were controlled by self-contained logic. This logic performs parallel operations for the voltage control inverter and keeps supply and demand in balance. (C) 2001 Elsevier Science B.V. All rights reserved.