Ethiopia is a developing country with a total access to electricity not exceeding 41% and thernnumber of household connected to this access is 17%. About 85% of the population lives in placesrnwhere access to electricity is less than 2%. Basonawrna, a small woreda in north shoa zone, has arntotal population of 250. The village is about 7km from Debre Berhan substation; which makes thernextension of the grid not yet practical, and off grid electrification is the best option for the village.rnThe community in this woreda uses Kerosene for lighting, biomass for cooking and dry cells forrnradios. Nothing has been done so far in developing the renewable energy resources, such as smallscalernhydro,rnsolarrnandrnwindrnenergy inrnthernvillage.rnThe main essence of this thesis is to design and analyze feasibility of PV-Micro hydro hybridrnelectric supply system to the Basonawrna woreda. HOMER software (hybrid optimization modelrnfor electrical renewable) as optimization analysis tool is used to verify the result. The reason behindrnthe selection of HOMER is that it simplifies the task of evaluating design of off-grid power systemrnfor variety of application. Hydro potential of the village, the gross head of the river and streamrnflow, data is obtained from Ministry of Water, Irrigation and Energy. Meteorological data of thernvillage is collected from National Meteorological Agency of Ethiopia and NASA. SurfacernMetrology is used for the estimation of solar energy potentials. Electric load for the basic needs ofrnthe community, such as, for lighting, radio, television, water pumps, milk processing, and flourrnmills is estimated. The system proposed and analyzed is a micro hydropower plant and battery. Inrnthis configuration, a micro hydro power plant of 20 kW and the battery bank of 55.5 kWh is used.rnThe micro hydro power plant generates approximately 122.6 MWh/year. The total net present costrnof the hybrid system is $108,631 and the cost of energy for the hybrid system is 0.096$/kWh.