This study proposes a CAES wind energy storage system composed of a windmill, a continuous variable planetary (CVP) transmission, a flywheel, a clutch, a reciprocating compressor, and an air tank. The mode of transformation of wind energy into compressed air in the system is also illustrated, in addition to details on the process of the controller design. The system controller can adjust the gear ratio according to the wind speed (V-wind) and rotational speed of the flywheel (omega(flywheel)). With a proper controller design to control the gear ratio, the flywheel can rapidly reach a rotational speed that is suitable for compressing the air into a tank. In addition, the windmill can be operated at the most efficient point. Therefore, transformation efficiency of wind energy into compressed air could be improved. After completion of the controller design, the efficiency of the two air compression systems (one system is driven directly by the windmill and another is driven by the flywheel) are compared to determining the target for improving performance in the future. (C) 2012 Elsevier Ltd. All rights reserved.