The flexible operation of battery energy storage systems (BESS) to support electricity grid modernization requires optimal planning and an efficient control strategy. This paper proposes the optimal allocation of BESS with photovoltaic systems for microgrids to enhance grid reliability and flexibility. An adaptive BESS control strategy is developed to allow the BESS to operate in both redundant and peak shaving modes. An evolutionary programming-based genetic algorithm implemented with an optimal power flow control is proposed to determine the BESS’s optimal location, sizing, and charge/discharge operation. The objective function is to maximize the benefits of energy loss reduction and peak shaving enhancement while minimizing the installation cost. The proposed approach is conducted with MATLAB and DIgSILENT PowerFactory software, which uses an intelligent automatic data exchange process to solve the optimal solution. A practical 22 kV grid-connected microgrid of Thailand is used as a test system to demonstrate the effectiveness of the planning and control strategy for the BESS installation. The simulation test results show that the proposed optimal BESS allocation and control strategy can significantly reduce the microgrid’s energy loss and peak demand and increase energy shaving leading to enhanced grid resiliency and reliability.