The economic and reliability benefits of adding a wind energy conversion system (WECS) to a power system are highly dependent on the wind turbine generator (WTG) installation design, i.e., the type and number of WTG. This paper presents an approach to determine the optimum installation design at each wind site considering the WTG parameters, the total cost of WECS and the power system reliability performance. The model is formulated as a combinatorial constrained optimization problem with a nonlinear, nondifferentiable objective function, which consists of the capital, maintenance and operating costs, and the costumer interruption costs. A number of constraints, including the total installed capacity at a specific wind site and the capital cost, are considered in the model. The model is solved using a genetic algorithm with adaptive crossover and mutation probabilities based on the standard deviation of chromosome fitness in a generation population. The proposed model and algorithm are tested on two power systems. The results show that the proposed approach can be used to obtain the maximum economic and reliability benefits associated with a WECS installation and is a powerful search technique for determining the optimum number and type of WTG considering reliability performance and costs.