The electricity generation through renewable resources is a crying need to increase the rural electrification rate to an appreciable value in Nigeria. Electricity can be supplied through either the national grid being extended or through off-grid systems. The grid extension cost depends on the location of the area, its terrain, the number of households, and distance of the area from a grid point. However, based on these factors and inadequate supply of electricity to even the areas connected to the national grid, renewable energy sources may provide an alternative means of electricity generation in rural areas in Nigeria. This research paper highlighted the design, evaluation, and the techno-economic feasibility of providing electricity to rural Dilchidama in Nigeria through renewable energy sources. Total 77 households, 1 primary school, 1 primary health centre and 4 shops having total estimated load of 306 kWh/d were considered. The design and techno-economic feasibility of the renewable resource was compared with extending the national grid to the area using HOMER and RETScreen tools.  The results showed that grid extension is much more cost competitive than the solar photovoltaic system for the study area for a maximum distance of 9.9 km. The sensitivity analysis performed by varying several input parameters indicated that solar photovoltaic renewable resource is a potential alternative beyond 9.9 km distance from the grid.