Fuel consumption share varies according to different sectors like residential, industrial, commercial etc. Traditional
fuel is predominant fuel source in case of developing countries like Nepal. Energy efficiency in these fuels are
very low compared to other fuels. Use of fossil fuels is also increasing in Nepal which are imported. These fuels
cause economic burden in country in addition to environmental problems like CO2 emissions. Hence, switching
over the fuels with least environmental problems, efficient energy is a requisite in today’s world. Energy efficiency
plays a critical role in energy policy debates because meeting our future energy needs comes down to only two
options: increasing supply or decreasing the demand for energy. In due time, the demand is bound to increase
due to increase in population, income growth and other factors. The switch-over from traditional fuels and fossil
fuels to electricity is imminent in very near future in Nepal. In Nepal, the generation being well below the maximum
demand and that the generation increment requiring time and capital investment, Nepal Electricity Authority
requires to adopt demand side management to control the load growth pattern as well as dwell in the supply side
investment. This paper intends to analyze the electrical energy and Peak Power requirements in Nepal in the
study year 2015-2050 and thus the need for implementation of effective Demand Side Management in Electricity
promptly.