Nepal is joining forces with the world to combat the greenhouse effect. The signing of United Nations Framework Convention on Climate Change shows the commitment and intense desire to contribute in some way in this respect. In February 1992, the United States announced an initiative to provide funds to help countries to address climate change. The Nepalese Department of Hydrology and Meteorology (DHM) took a keen interest and initiative for the Country Study Program. Out of the four objectives of climate change proposal "To identify and evaluate technical options for mitigating climate change through reducing emissions of green house gases (GHG's) and expanding sinks for these gases" is one of them. Draft Report on Mitigation Assessment of Greenhouse Gases Emissions for Energy Sector in Nepal is the product of that of that study in Nepal.
Nepal is one of the least developed countries of the world, depending on an economy that is very much agrarian. The major energy consuming sectors can be clearly disaggregated into domestic, transport, industrial, commercial and agricultural sectors. More than 90% of the energy supply is from traditional sources (fuelwood, agricultural residue and animal waste); the rest is from commercial fuel such as petroleum products and electricity. The domestic sector accounts for more than 95% of the energy consumption; whereas the transport sector consumes most of the commercial fuel, i.e., petroleum products. Using the MARKAL model, the total emission of carbon dioxide in tons of carbon as well as in gigagrams (Gg) is estimated to increase from around 770 Gg (209,689 tons of carbon) in 1990 to around 7,590 Gg (2,070,725 tons of carbon) in 2030 for the baseline scenario. For 1990 the IPCC method gives 858 Gg of CO2.