•A novel PV-TE system was presented.•Mathematical model of the system was built.•Performance under different ambient conditions was analyzed.•New PV-TE and the conventional PV were compared.•Preliminary economic analysis was demonstrated. Photovoltaic-thermoelectric (PV-TE) hybrid system is one typical electrical production based on the solar wide-band spectral absorption. However the PV-TE system appears to be economically unfeasible owing to the significantly higher cost and lower power output. In order to overcome this disadvantage, a novel PV-TE system based on the flat plate micro-channel heat pipe was proposed in this paper. The mathematic model was built and the performance under different ambient conditions was analyzed. In addition, the annual performance and the preliminary economic analysis of the new PV-TE system was also made to compare to the conventional PV system. The results showed that the new PV-TE has a higher electrical output and economic performance.