The critical impacts of climate change have imposed an imperative for accelerated global actions to curb the greenhouse gas (GHG) emission. The “historic Paris agreement” on climate change as well as the Sustainable Energy for All (SE4All) initiative are among the well-known foundations to restrict GHG emission by promoting renewable energy (RE) across the globe. In Yemen, a country with abundant RE resources, feasibility studies to explore RE potentiality are scarce. This paper first reviews the historical development of RE technologies as well as the RE prospects in Yemen. This is followed by a comprehensive feasibility study of an off-grid renewable-based power system for rural electrification in Yemen. Shafar, a key district in Hajjah province, is considered as a case study. Five different cases (various combination of energy resources) of power system have been investigated with a key objective to find out the most suitable hybrid system that yields the minimal system cost as well as environmental impact. In this work, the hybrid optimization model for electric renewables (HOMER) is employed to perform the optimization and sensitivity analysis. The simulation results indicate that combination of photovoltaic and wind energy system achieves potential reduction of 100% in the CO2 emission, along with 30% decrement in the cost of energy (COE). Comparatively, the photovoltaic/wind/diesel energy system could only achieve 70% reduction in the CO2 emission but 45% decrement in the COE. Furthermore, the latter case exhibits a superior system robustness to RE variability in comparison with the former case. Finally, the study recommends the deployment of the proposed hybrid system (photovoltaic/wind/diesel) as the means for Yemen (and other similar context countries) to sustainably achieve Paris agreement targets and the SE4All initiatives, simultaneously.