In this paper, a photovoltaic (PV) module-level Cascaded H-Bridge (CHB) inverter with an integrated Battery Energy Storage System (BESS) is proposed. The advantages and drawbacks of the CHB circuit architecture in distributed PV generation systems are highlighted. The main benefits are related to the higher granularity of the PV power control, which mitigates mismatch effects, thus increasing the power harvesting. Nevertheless, heavy unbalanced configurations due to the intermittent nature of PV sources need to be properly addressed. In order to smooth the PV fluctuations, a Battery Energy Storage System is used to provide both an energy buffer and coordination of power supply and demand to obtain a flat profile of the output power. In particular, by exploiting the inherent modularity of the conversion circuit, a distributed storage system is also implemented by splitting the battery into smaller units each of which represents the backup module of a single power cell of the PV CHB. The proposed design and control strategy allows overcoming the operating limits of PV CHB inverter. Simulation results, carried out on a single-phase nineteen-level PV CHB inverter, evidence the effectiveness of the proposed design and control approach to minimize the adverse impact of deep mismatch conditions, thus enabling continuous power output by compensating PV power fluctuations.