Nepal relies heavily on traditional energy resources, as no significant deposits of fossil fuel are available. Nepalese use the lowest commercial energy (around 500 kWh per capita per year) of all South Asians by far. The total energy consumption in Nepal for the year 2003/04 was 363 million GJ of which the residential sector consumed 90% and agriculture sector 1% as shown in the figure. Based on the fuel type, biomass provided 86% of the total energy consumption, petroleum 9%, which is mainly consumed by urban areas, electricity only 2% and renewable 1% of the total energy. About 40% of the total population has benefited from electricity by the end of the Ninth Plan. This 40% is reported to include consumption of 33% from National grid and 7% from alternative energy.

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