Energy conservation projects and renewable energy power generation are the future of sustainable energy supply. Combining both is very effective and maximize benefits. PTs building sector is the highest consumer, constitute 48.6% of the total Palestinian balance. Until now, there is no specific Palestinian engineering building code. As a result, building insulation is still mandatory. There are few performed studies about optimal building insulation thickness installation economic and environmental benefits.Regarding renewable energy national share increase, the PA developed many ambitious plans, most of it concentrated on increasing PV systems installed capacity due to its high potential. PTs enjoy 3000 sunshine hours per year, 5.4kWh/m2/day average solar radiation. Similarly, there are few studies targeting Palestinian buildings renewable share increase through the principle of self consumption.This reseach presents a novel approach in investigating the economic feasibility of installing optimal insulation thickness in buildings. Practically, insulation layers are installed during the building phase, before mechanical building systems. However, insulation effect will reduce AC required capacity as a result of reducing summer CL, thus, reduce initial investment. For that reason, P1-P2 method has been used to generalize optimal insulation thickness approach for the West Bank area considering different Tb value. It has been found that at Tb=18oC, optimal thickness values, total cost, energy saved, and Np values are 10-11cm, 18$/m2, 175-375$/m2, and 5-14 years, respectively. Then, a commercial building in Ramallah city was taken as a case study, the building has 1,700m2 roof area for PV installation. PVsyst program is used to design 173kWp system. It is estimated to generate 320MWh per year for building self consumption. The insulation effect raised renewable energy share from 62.6% to 64.1%, and reduced AC rated capacity by 20 refregeration ton (saved $20,000 as initial investment).