Current power systems create environmental effects because of the using of fossil fuels, specially coal, since CO 2 is released to the atmosphere. Contrary to conventional energy sources, renewable energy sources produce a clean energy which is in general free of pollution, environmentally sustainable and technologically efficient. There is an increased interest in solar energy that can generate electricity with no greenhouse gas emissions. Photovoltaic systems are used to convert the sunlight into electricity. The goal of this research is to design an optimum off-grid photovoltaic/diesel hybrid energy system for a remote hamlet in Al-Kuwayr region north of Iraq. HOMER software is used to implement the techno-economic and environmental feasibility study of the proposed system. It simulates all feasible system which fulfill the load of the chosen sites under specific conditions of the available renewable resources. The analysis of the optimum hybrid energy system is presented to estimate the standalone electrification and compare it with grid expansion. The simulation results show that the optimum hybrid power system consists of 25&50 kW diesel generators, 60 kW photovoltaic arrays and 40 kW converter with no batteries. The power system is capable of providing up to 64 kW peak load. Furthermore, the off-grid photovoltaic/diesel system is found to be more frugal than grid expansion.