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A standalone photovoltaic (SPV) system is usually used to provide electricity for people living in the remote areas, like some areas in Sabah and Sarawak of East Malaysia, where the national electricity grid can neither be accessed nor economically extended. The applications of the SPV systems in these areas range from lighting, radio, television and refrigerator to water pump, vaccine refrigerator and telecommunication. Although the SPV systems are sustainable and environmentally-friendly for electricity generation, high cost is always the barrier to hinder these systems into widespread applications. In order to reduce the system cost as much as possible, a new approach to design the SPV systems is presented. In this approach, the technical and non-technical factors including the selection of the optimal tilt angle of solar array and the maximum battery depth of discharge, life cycle of system, inflation rate and interest rate are taken into account in the system design. The optimal sizes of solar array and battery are determined at the minimum cost for the given load profile and the desired loss of power supply probability.