As wind power penetrations increase in isolated power systems, the power from wind energy will start to replace conventional generation units and its influence on power systems cannot be neglected. On the other hand, wind farm with the centralized power control scheme can behave as an active controllable component in the power system according to power references from system operator. Nevertheless, there are normally large uncertainties in the prediction of wind power output because of the intermittent nature of wind. Therefore, additional up/down reserve on a system is needed to cater for any possible unexpected generation deficit. This leads the increase of operating cost of power system. This paper presents an algorithm for active power output limitation of wind farm considering system operating cost in the isolated power systems. The unit commitment formulation for the system with wind farms is presented. Then, the procedure to adjust the generation schedule using decommittment method is proposed. In order to validate the effectiveness of the proposed algorithm, some numerical experiments with 10 unit system are conducted.