An uninterruptible power supply (UPS) and method for managing power flow in a grid-tied photovoltaic system, wherein the UPS provides grid-tie, backup power, voltage-frequency relay, power factor control, and load-leveling functions. The UPS includes a bi-directional power converter, a switch, and a controller. The converter converts between AC power and DC power, and includes ports which are connectable to a battery, a plurality of current-source inverters, a load, and an electric utility grid. The switch selectively connects and disconnects the converter from the grid. The controller monitors the voltage and current associated with the grid, and based thereon, controls the switch and the bi-directional power converter to manage power flow in the grid-tied photovoltaic system. The controller also manages the power factor of the current flowing into or out of the grid by introducing appropriate distortion or displacement current.