The extensive use of fossil fuel is destroying the balance of nature that could lead to many problems in the forthcoming era. Renewable energy resources are a ray of hope to avoid possible destruction. Smart grid and distributed power generation systems are now mainly built with the help of renewable energy resources. The integration of renewable energy production system with the smart grid and distributed power generation is facing many challenges that include addressing the issue of isolation and power quality. This paper presents a new approach to address the aforementioned issues by proposing a hybrid bypass technique concept to improve the overall performance of the grid-tied inverter in solar power generation. The topology with the proposed technique is presented using traditional H5, oH5 and H6 inverter. Comparison of topologies with literature is carried out to check the feasibility of the method proposed. It is found that the leakage current of all the proposed inverters is 9 mA and total harmonic distortion is almost about 2%. The proposed topology has good efficiency, common mode and differential mode characteristics.