Majority of rural areas in India have already been electrified, yet the disparity between demand and supply is considerably higher and broadened due to which nation’s rapid financial growth as well as rising standards of living in both the urban as well as rural areas. Hence, the utilisation of renewable resources is rising steadily for the mitigation of such energy crisis. It has become necessity to use a hybrid sustainable energy system by exploiting the strengths of each source in combination with one another to minimise the dependence on the congested power grid. For the efficient use of readily available renewable energy and sustainable rural electrification, this study proposes an effective Active Distribution Network (ADN). A comprehensive techno-economic analysis has been performed on the design of an ADN system that includes the exploitation of solar and biomass energy as sources of power for sustainable rural electrification. In the proposed work, performance assessment elements such as output responses, component costs, feasibility and sensitivity of the project, emissions, inflation rate, and changing the pricing of integrant have been taken into consideration and analysed. Results shows the improvement in rural electrical system while lowering system energy costs along with consideration of environmental impact.