Wind energy has taken off into a new peak in terms of its popularity among other new generation technologies. The socio-economic and environmental benefits impact the general population. A low cost of energy along with grid compatibility can be achieved due to mass production technology, power electronics advancement, and intelligent controllability. This paper attempts to shed the light on many aspects of wind generation with the aim to illustrate the dynamic operation of wind generation. Public domain software called RPMSim is used to perform simulations needed to study different types of interactions between the electricity grid and wind power generation. To make this study interesting and yet easy to understand, a hybrid wind power simulation is used as the subject of this paper. A small village with a varying load, a wind turbine with varying wind speed, dump load, and capacitor compensations are elements included in the simulation. This paper is intended to study the small village concept rather than to optimize an existing installation. The balance of real and reactive power and the impact on the frequency and voltage regulation will be illustrated in this paper, and switching events will be used to perturb the system under consideration.