This paper presents a scenario-based simulation analysis of the operation of the insular power system of Crete, Greece, on an hour-by-hour basis aiming at the evaluation of the impact of high Renewable Energy Sources (RES) penetration on the short-term power system scheduling. The possibility of introducing a pumped-storage plant as a storage facility to alleviate the negative effects of increased RES generation on the short-term operation is also investigated. The renewable generation impact is evaluated in terms of specific system indicators. An integrated software tool that performs annual simulation of the insular power system with hourly granularity aiming at the minimization of the total production cost while respecting the system and various generating unit operating constraints is used. Simulation results for the year 2015 provide quantitative assessment of the insular power system performance regarding its short-term operation under large-scale RES penetration and valuable conclusions are drawn. (c) 2015 Elsevier Ltd. All rights reserved.