The Graciosa project combines a large scale battery energy storage system with renewable electricity generation from wind power and photovoltaics in a hybrid power plant to reduce the environmental impacts caused by the previous electricity generation by 100 % Diesel combustion on Graciosa Island, Azores. The goal of this contribution is to assess and compare the selected environmental impacts related to the electricity generation of the previous and the new system by using Life Cycle Assessment. To accomplish this goal, all energy and material flows that occur during production, use and recycling/disposal of the electricity generating systems are quantified and evaluated. The results of the Life Cycle Assessment show a reduction of environmental impacts of approx. 43% due to the transformation to the hybrid electricity supply system with high shares of renewable energies (65%). In the new electricity supply system, the majority of environmental impacts (>60%) is still caused by the remaining Diesel based electricity generation. Environmental impacts, which are associated with the construction of the large scale battery energy storage system, account for only 6% of total impacts. Wind power and photovoltaics account for 18% and 14%, respectively.