Smart Grid demands changes to the existing distribution system. One of the ways to improve the operation of the distribution system is to use battery storage technology to aid the distribution network in minimizing the outage duration of the loads. The battery technology has the capability to improve the reliability of the system. This thesis work develops a pragmatic battery operation model and evaluates the reliability of the system using a simulation based technique. Different aspects of the battery such as state of charge, degradation of the battery capacity over time and limited capacity of the battery are included in the battery modeling. A modified Time Sequential Monte Carlo (TSMC) simulation technique is proposed in this work to include the failure effect of a component on its downstream elements. To verify the truthfulness of the modified TSMC it is tested on a feeder from Roy Billinton Test System (RBTS). The results of the simulation are analyzed with TSMC and analytical techniques. Further, a feeder with battery storage is evaluated using the modified TSMC technique and the reliability indices are determined.