The present invention provides a distributed combined cooling, heating and power generating apparatus with an internal combustion engine by combining solar energy and alternative fuel and a method thereof, the apparatus comprising: an energy storage system for combined reaction between solar energy and alternative fuel, a solar fuel internal combustion engine generating system, a lithium bromide refrigeration system for absorbing exhaust heat of flue gas of solar fuel, a reaction device for recovering exhaust heat of flue gas, a heat exchanger for recovering exhaust heat of exhaust gas and a cylinder jacket and water plate heat exchanger. According to the present invention, solar energy is combined with alternative fuel to achieve conversion of solar energy to fuel chemical energy, such that solar energy is stored in form of synthesis gas fuel and combined with the combined cooling, heating and power generating system, which possesses high energy storing intensity, includes small volume of storing device, and achieve the objects of cooling, heating and power combination in low cost and high efficiency, thereby effectively solving the problem of difficulty in storage, and high cost and low efficiency in usage.