Energy storage systems are ideally placed to harness the intermittent energy from renewable sources which are often connected with weak electricity distribution systems to form local microgrids. Due to the large variation in load/generation balance of microgrids, an energy storage system is required to have a large power density and respond quickly to power fluctuations on a short time scale of seconds to minutes. Additionally it needs to have a large energy density in order to deal with power imbalances on a longer term basis. For microgrids, where power levels are in the range of a few megawatts, there is one technology for the required energy density: electrochemical batteries, and three prime candidate technologies for the required power density: SMES systems, supercapacitors and flywheels. Although the batteries usually have large energy densities, their power densities, life cycles and response speeds are very limited. On the other hand, flywheels, supercapacitors and SMES systems have large power densities, large duty cycles and fast response speeds. Compared to flywheels and supercapacitors, SMES systems have significantly larger power densities and module power ratings. In addition, they also have advantages including high round-trip efficiencies and solid-state operation. A game-changing energy storage system can thus be achieved by integrating fast-responding SMES systems of high power densities with electrochemical batteries of high energy densities. This system can substantially reduce the number of charge/discharge cycles of batteries and thus extend their life, leading to a significantly reduced volume of usage and hence environmental impact of batteries in renewable energy integration. There are several fundamental limits that prohibit widespread applications of previous SMES systems using low-temperature superconductors (LTS) and first-generation high-temperature superconductors (1G HTS). LTS require liquid helium as a coolant which is scarce resource and thus expensive. Due to their small operational magnetic field and current density, SMES systems using 1G HTS have a small energy and power density. In addition, their price is prohibitively high. Recently 2G HTS have been significantly enhanced in terms of increased operational magnetic field and current density which enables SMES systems to achieve a substantially higher energy and power density. Predictions indicate the cost of 2G HTS in terms of $/(kA*m) will drop below 1G HTS and copper in the near future. Thus there is now a critical opportunity to develop a SMES system using 2G HTS. A major technical hurdle for the widespread application of SMES to renewable integration is that its energy storage component, i.e. superconducting coils, needs to be properly modelled and characterised if to be used in hybrid energy storage systems. In this project, SMES systems are proposed for the first time to be used continuously on short time scales of seconds and as part of a hybrid energy storage system. Here, a novel multi-physics model will be created based on numerical methods and at the same time can be utilised in standard electrical circuit analysis tools. A demonstration kiloJoule-range 2G HTS coil will be designed and constructed. The coil will be firstly tested at 77K whilst being stand-alone or connected with laboratory-based microgrid systems. Then the coil will be characterised between 50K and 77K using the facility provided by Florida State University - Centre for Advanced Power System. The experimental results will give us confidence in applying the model and design methodology for future large scale superconducting coil design. Importantly, the results can be used as guidance of future SMES system design at the fabrication stage. Specific recommendations to superconductor manufacturers will be available for further improving the conductors for energy storage application.