This study determines the optimal capacity of various components of an AC mini-grid hybrid power system in a remote area of South Australia. A range of generation and storage technologies, such as diesel generators, wind turbines, solar photovoltaic arrays, battery banks, and flywheels are considered. A minimum system operating reserve is maintained to ensure a certain degree of reliability. Four different configurations of hybrid power systems are analysed in hourly time-steps, over a year, using real data for system load, solar insolation, ambient temperature, and wind speed. Particle swarm optimisation approach is used to optimise the capacity of various components of each hybrid system to obtain the minimum net present cost (NPC) over a 20-year system lifespan. Suitable capital, operating, and maintenance costs in Australian context are considered in evaluating the system. Various simulation results, such as annual energy balances, NPCs, levelised cost of energy and cash flow analysis obtained for each optimised system are carefully analysed and discussed. The modelling and results confirms the feasibility and economical replacement of the diesel power system with those of hybrid power systems which use renewable energy supply.