Conservation of energy and protection of the environmental resources are two of the biggest challenges in planning for a higher quality of life in our communities and sustainable economic development for the society at large. This study models the pattern of energy consumption in all sectors of the community in a medium-sized town in north India. The environmental impacts of energy consumption in human activities-domestic, commercial and industrial-have been assessed. Public systems for providing municipal services have been evaluated both in terms of energy requirements and their effectiveness in providing desired levels of service. Policy options for strategic interventions in each major sector have been identified and the capacity of the local government to mobilize resources for implementing some of the recommended strategies has been assessed. Overall the study evolves a general methodology for addressing issues at the energy-environment interface in other similar communities.