In this paper, the development and the performance of a viable distributed grid-connected power generation system of Photovoltaic-Energy Capacitor System (PV-ECS) considering solar energy estimation have been described. Instead of conventional battery Electric Double Layer Capacitors (EDLC) are used as storage device and Photovoltaic (PV) panel to generate power from solar energy. The system can generate power by PV, store energy when the demand of load is low and finally supply the stored energy to load during the period of peak demand. To realize the load leveling function properly the system will also buy power from grid line when load demand is high. Since, the power taken from grid line depends on the PV output power, a procedure has been suggested to estimate the PV output power by calculating solar radiation. In order to set the optimum value of the buy power, a simulation program has also been developed. Performance of the system has been studied for different load patterns in different weather conditions by using the estimated PV output power with the help of the simulation program.