Although energy is the key element for improving the quality of life, ever increasing use of fossil fuels cannot be the basis for sustainable development. These have unexpected environmental consequences in local and global scale. The need to increase energy supply in a developing country like India is unquestionable. To meet the proposed energy needs, India must produce nearly double the quantity of coal (550 Mt/y) by 2010 AD, as it is mining at present. Rapid growth of the energy sector has made environmental protection a highly complex and more difficult task. There is a pressing need for alternate sustainable supplies of energy. This article examines the energy resources and some of the key environmental issues in these sectors. The focus is on the options available for the supply of energy. Geothermal energy, its potential, recovery, present scenario of utilization and its utility as a cleaner source have been discussed. The development of non-conventional energy in Indian context has been described. This article concludes by identifying geothermal energy as one of the potential sources of energy for maintaining a clean environment.