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The paper proposes a novel hybrid algorithm connecting interior point method (IPM) and differential evolution (DE) for solving economic load dispatch problem with valve point effect. The algorithm involves two stages. The first stage employs IPM to minimize the cost function without considering the valve point effect. The second stage considers valve point effect and minimizes the cost function using DE. The initial population for DE is generated in a narrow range of 2π/f around the solution obtained in the first stage. The effectiveness of the algorithm is validated by carrying out extensive tests on three different systems involving 13 and 40 thermal generating units. The proposed method outperforms other existing techniques for economic load dispatch considering valve-point effects.