Increasing environmental awareness has made the environmental costs associated with the development of energy an important factor in the choice of energy forms in the mountains. The major energy consumption sectors in mountain areas are households, agricultural farms, and cottage industries. Households need energy for cooking, lighting, and space-heating. In agriculture it is needed for land preparation, cultivation, irrigation, harvesting, post-harvest processing, storage, and transportation of agricultural inputs and outputs. Most energy inputs into land preparation, cultivation, and post-harvest processing are in the form of human and animal labour as the degree of mechanisation is generally low.
Many cottage industries operate as family enterprises on a micro-scale.
The energy needs of cottage industries include lighting, heat for processing, and motive power. The commercial sector uses energy for cooking, heating, and lighting, whereas the transport sector uses energy for operating different kinds of vehicles, in addition to the extensive use of animate energy in rugged mountain areas.