Long term energy goals that the EU has set for the years 2020 and 2050, in order to increase its security of energy supply, decrease the impact on the environment and stimulate sustainability, are binding to all member states. Croatia as a new EU member state needs to reconsider and develop new energy policy towards energy efficiency and renewable energy sources. One of the key processes is rational energy consumption and gradual national energy demand decrease. Having said this; it is important to understand what mechanisms are influencing energy demand and what is their long term impact, so future energy demand fluctuations can be modelled. Classical energy demand planning is usually focused on establishing a relationship between economic indicators, such as the GDP, and energy consumption. This is usually done based on analyzing different historical data and processing them in a relatively simple way, like time series analysis, or applying more complex analyses using neural networks, genetic algorithms or similar methods. It is argued that this approach has become inefficient in the case of EU countries which strive towards decoupling their economic growth and energy consumption. Numerous initiatives towards lowering energy consumption in the EU by implementing different Directives, financial schemes and mechanisms that should result in lowering energy demand in the future substantiate this argument. A new approach in the energy demand planning process is necessary. In order to describe and quantify energy policy measures bottom up engineering models, focused on end users, have to be used. Throughout this thesis, the author has developed the National energy Demand model (NeD model) and used it to calculate long term final energy demand of Croatia. The model is based on sectoral approach and includes six major economic sub models; households, transport, industry, services, construction and agriculture. The results of the NeD model are compared to two available studies/models, the Primes EU28 and the Croatian national strategy. As an additional segment of this thesis is the implementation of the NeD methodology into LEAP model, in order to have more simplified long term energy demand model of Croatia which would be more easily used. The main question that the author asks is: what is the effect of the implementation of various energy policies on the long term energy demand, primarily, but also what is the effect on the environment and national economy.