Distributed energy storage systems (DESSs) have huge potential to balance distributed renewable power generation and load demands for consumers of prosumers. DESSs are capable to reduce barriers by eliminating intermittencies in distributed renewable energy sources in microgrids. Since the electricity prices are higher during the peak hours, DESSs can be used to store energy during residential off-peak (but solar peak) hours and utilized this energy during residential peak hours for reducing electricity bills of consumers or prosumers in microgrids. However, energy storage systems are still expensive components for residential microgrids and these need to be effectively utilized in order to provide a cost-effective solution. In continious analysis economic benifit also carried out. Maximum rate of return on investment, maximum profit margin, and annual revenue are includes in economic analysis. This paper present an alternative solution, a cloud energy storage system (CESS) for effectively utilizing DESSs in residential microgrids while reducing both electricity bills and installation costs for ESSs. This work presents an analysis on the feasibility and profit ability of CESSs.