Hybrid energy systems are receiving more popularity in remote areas to provide low-cost electricity by taking advantage of existing electric generation systems and new generations of renewable energy resources. Such hybrid systems will increase reliability and decrease the cost of electricity. Renewable energy sources are gaining more attention due to their flexibility in utilization of locally available resources and their contribution in cleaner energy production. To this end, this thesis scrutinizes the viability of a hybrid renewable energy system (HRES) incorporating wind turbine and photovoltaic (PV) for Kagbeni village located in Nepal. The proposed framework covers both economic and technical aspects. For economic feasibility analysis, the Hybrid Optimization Model for Electric Renewables (HOMER) software is utilized to recognize the optimal size of required assets (i.e., PV module and wind turbine) to be incorporated into the current system. For the technical analysis, Electrical Transient Analyzer Program (ETAP) software is used to virtually model the projected HRES to assess the feasibility of the optimized HRES in operation modality (e.g., power flow, short circuit analysis, and protection coordination). The obtained results confirm that the integration of PV and wind units into the current Kagbeni power grid can lead to an economically feasible and reliable microgrid enhancing the social well-being of Kagbeni’s residents.