This report presents a comprehensive analysis of a parallel-connected compressed air energy storage (CAES) and wind turbine system designed to improve power grid performance. The study addresses the challenges of integrating wind energy into the grid, specifically the fluctuations caused by the intermittent nature of wind. The research utilizes Matlab Simulink to model and simulate the system, focusing on active power and grid voltage. The report includes a literature review, detailed research methods, data analysis, and expected outcomes. The findings demonstrate the effectiveness of the parallel CAES system in smoothing power fluctuations and maintaining a stable power supply to the grid. The study also explores the compression and expansion stages of the CAES system, including the use of compressors, heat exchangers, and turbines. The results indicate that the parallel CAES configuration significantly reduces wind power fluctuations and maintains constant power generation, providing valuable insights into enhancing the reliability of renewable energy sources.