It is predicted that the major increase in energy consumption and, thus, carbon emissions, will happen in the developing world. However, in most developing countries the knowledge about energy efficiency, particularly in the building sector, is quite low. Strategies developed for industrialised countries might not be suitable or must be adapted for the very different context of developing countries. This research aims to find energy-efficient and cost-effective building design options for the case of Nepal. Energy-efficient building design is a non-trivial issue involving a number of interdependent design criteria. Particularly, in composite climates, passive design strategies might conflict each other leading to an inefficient building design. This paper explores the energy conservation potential in hotel design for all bioclimatic zones of Nepal using building energy simulation with parametric analysis. Based on extensive field studies, reference models for typical hotel buildings ranging from small-scale resort hotels to large-scale multi-storey hotels were developed. These reference designs were optimised by varying design parameters such as window-to-wall ratio, glazing material, shading devices, glazing type and insulation levels. During the design optimisation, energy demand as well as cost effectiveness were evaluated. Finally, recommendations for energy-efficient and cost-effective hotel design solutions were suggested. In addition, the bioclimatic zoning for Nepal was consolidated leading to five elevation-based zones that can be used to introduce building energy regulations in the future.