The emanate use of distributed energy sources in electricity grid has created new ultimatum for the utility load as regard to power quality, voltage stabilization and efficient energy utilization. Wind and Solar are considered as the most assuring source of renewable energy. However, the standalone operation of either Photovoltaic or wind energy system does not offer a very reliable source of electricity production, mainly due to the unpredictability over the availability of the wind and solar irradiance. Thus, an assortment of wind and solar power generation structure can form a very much potential and reliable source of electricity. In this work a hybrid model of wind and Photo- voltaic system has been presented. This kind of systems very beneficial and useful to the remotely located or islanded areas where grid integration is not very economical. However, the interfacing of power electronic devices to DG systems induces very severe power quality problems, such as, harmonic generation and the reactive power compensation that disturbs the power distribution system. In this work, a simulation model of hybrid wind-PV generation system of capacity 750 KW has been presented. The performance of this system with grid connected mode is analyzed. The power quality of the wind-SPV hybrid system has been evaluated by calculating the total harmonics distortion (THD) at different wind speed. Power quality of this hybrid system has been improved by using DSTATCOM.