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Water, energy and environment are essential inputs for sustainable development of society. It is a common phenomenon that certain packets of the country that are water stressed are also power stressed at the same time. There is a huge potential for utilizing renewable energy sources, for example solar energy, wind energy, or micro hydropower to provide a quality power supply to remote areas. The abundant energy available in nature can be harnessed and converted to electricity in a sustainable way to supply the necessary power to elevate the living standards of the people without access to the electricity grid. The advantages of using renewable energy sources for generating power in remote areas are obvious such as the cost of transported fuel are often prohibitive fossil fuel and that there is increasing concern on the issues of climate change and global warming. The disadvantage of standalone power systems using renewable energy is that the availability of renewable energy sources has daily and seasonal patterns which results in difficulties in regulating the output power to cope with the load demand. Combining more than one form of the renewable energy generation and also conventional diesel power generation will enable the power generated from a renewable energy sources to be more reliable and affordable. This kind of electric power generation system, which consists of renewable energy and fossil fuel generators together with an energy storage system and power conditioning system, is known as a hybrid power system. This paper elaborates on the analysis of small capacity hybrid power system for supplying electricity and clean water demand in rural and remote areas by using mini-grid hybrid power system consisting of renewable energy (Solar Photovoltaic cells & Windmill) and battery with a reverse osmosis desalination plant as a primary / deferrable load.