This paper presents a Mixed Integer Linear Programming model for selection of energy system and allocation of energy that satisfies energy needs of multiple end-uses at a location and minimizes the sum of annual fixed and variable costs. The energy generation and distribution is modelled as two stages of energy transfer, i.e., the energy generated at first stage energy systems is distributed sometimes via second stage energy systems to the ultimate end-uses. The model includes several time periods during a year to realistically accommodate different efficiencies of energy systems and varying energy demand during different periods of a year. Application of the model to four villages is discussed. Sensitivity analysis is presented indicating the sensitive areas which need attention of developmental agencies and which can contribute towards reducing the energy costs and encourage utilization of local energy resources.