The Kingdom of Saudi Arabia has an area of 1.69 million square kilometers. It is the biggest oil producers in the world, and the electricity industry relies heavily on oil. The annually growth request for electricity is around 5%. The price of electricity will be expensive in the next 30 years and there could be a shortage of electricity supply. It is better to use alternative forms of energy to prolong the life of the oil industry in Saudi Arabia. To reduce dependence on oil, the Kingdom of Saudi Arabia is considering using alternative sources of energy including solar energy and energy wind. Since the wind speed is around 10m/s and in the summer it is full of sunshine; therefore, the renewable energy should play a more important role in future electric power supply of the Kingdom of Saudi Arabia. A hybrid system is proposed in this thesis to study the possible power supply system in the remote areas. Wind information in Dhahran is used in simulations in order to make sure that the system is reliable and appropriate to be used in the remote areas of the country. Economic analysis is also conducted to compare the cost of the hybrid system with that of a 200 km transmission line connected from existing service area.