With the substantial growth of solar photovoltaic installations worldwide, forecasting irradiance becomes a critical step in providing a reliable integration of solar electricity into electric power grids. In Singapore, the number of PV installation has increased with a growth rate of 70% over the past 6 years. Within the next decade, solar power could represent up to 20% of the instant power generation. Challenges for PV grid integration in Singapore arise from the high variability in cloud movements and irradiance patterns due to the tropical climate. For a thorough analysis and modeling of the impact of an increasing share of variable PV power on the electric power system, it is indispensable (i) to have an accurate conversion model from irradiance to solar power generation, and (ii) to carry out irradiance forecasting on various time scales. In this work, we demonstrate how common assumptions and simplifications in PV power conversion methods negatively affect the output estimates of PV systems power in a tropical and densely-built environment such as in Singapore. In the second part, we propose and test a novel hybrid model for short-term irradiance forecasting for short-term intervals. The hybrid model outperforms the persistence forecast and other common statistical methods. (C) 2016 Elsevier Ltd. All rights reserved.