In recent years, a determined shading ratio of photovoltaic (PV) systems has been broadly reviewed and explained. Observing the shading ratio of PV systems allows us to navigate for PV faults and helps to recognize possible degradation mechanisms. Therefore, this work introduces a novel approximation shading ratio technique using an all-sky imaging system. The proposed solution has the following structure: (i) we determined four all-sky imagers for a region of 25 km2, (ii) computed the cloud images using our new proposed model, called color-adjusted (CA), (iii) computed the shading ratio, and (iv) estimated the global horizontal irradiance (GHI) and consequently, obtained the predicted output power of the PV system. The estimation of the GHI was empirically compared with captured data from two different weather stations; we found that the average accuracy of the proposed technique was within a maximum ±12.7% error rate. In addition, the PV output power approximation accuracy was as high as 97.5% when the shading was zero and reduced to the lowest value of 83% when overcasting conditions affected the examined PV system.