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This paper presents a fuzzy set based modeling of wind power generation. The wind power generation has been solved by the proposed fuzzy generation for an island in Taiwan. The cost effectiveness of wind power generation is then evaluated by calculating the avoided generation cost of diesel generators. The load survey study has been performed to find the typical daily load patterns of various customer classes. With the typical load patterns and total energy consumption by each customer class, the load composition and daily power profile of the isolated power system are therefore derived. The wind power generation of eight wind turbines and the corresponding avoided generation cost is estimated by the fuzzy generation model according to the hourly wind speed. The power generation and the corresponding cost of diesel generators required to meet the system power demand with wind power generation have therefore been obtained. It is found that the wind power generation can economically and effectively substitute the generation cost of the diesel power plant and provide the partial power supply capability for the net peak load demand.