Solar PV energy is one of the most promising renewable resources that use the abundant and free energy from the sun having clean, inexhaustible and environment friendly cyclic operations. However, the intermittent nature of the output power of PV systems reduces their reliability in providing continuous power to customers. Solar PV energy can be used mainly in standalone (off-grid) and grid connected system. A stand alone solar PV cannot provide a continuous supply of energy due to seasonal and periodic variations. Therefore, in order to satisfy consumer load demand, grid connected PV energy systems that combine solar energy and other conventional conversion units are becoming more popular in recent years. But, the fluctuations in the PV output power with climatic conditions might lead to undesirable performance of the electric network in grid connected system. The objective of this work to study the performance analysis of grid connected solar PV system. To accomplish this, the mathematical modeling of 1kWp grid connected system is carried out and the power profile is estimated using historical environmental data collected over a number of years at Kathmandu. Identified the possible operational problems that might arise in grid connected PV system and different strategies that can mitigate these problems are studied. In addition, the performance of the system is evaluated.