Renewable energy has varied through time that depends on the renewable sources that limit continuous supply of electricity for the study area. This intermittency nature solved by combining different renewable resources that complement to each other for stand-alone micro grid system. A micro grid consists of two or more renewable resources combined together for specific site power generations. For this study, solar PV, mini hydro and storage battery bank are the components of the micro grid. The study discussed in detail for AC-micro grid system of design, simulation and performance evaluation with economic feasibility analysis of the system in rural village of Ethiopia. The study assesses the proper load demand for about 292HH and community service institutions in Gora got and dibkan villages. The solar resources, the river flow rate and other weather data collected from primary and secondary resources to test and analyze the performance of the system. This micro grid renewable energy power generation consists of 174.2 kW hydro, 48kw solar PV power produced with 800w/m2 at Standard Test Conditions and 226.3kwh storage battery (for two days’ autonomy). The battery used in this micro grid system is to balance the demand and renewable power generation or for selected critical loads when these power generation, sources are not available or non-functional. The system model is discussed with each components of the renewable sources and controlling mechanisms of standalone AC micro grid. MATLAB Simulink toolbox used to model the renewable energy sources, battery bank and conversion systems like DC-DC converters, Rectifier, and inverter with controller of each component. The system model individual components and analyze the system voltage stability for proper function of the micro grid. The battery control strategy has done to protect from over charging and discharging process. In this study, the economic evaluations are performed using Homer Software. The cost of the individual components incorporated for system cost analysis. The energy cost of the system is about $0.080/kwh, which is feasible. The homer software analyzes the economic aspects of this micro grid system. Considering social, economic and other advantages gained from this electricity access, the project shall implement by government or non-governmental organizations.