Instead of planting new electricity generation units, there is a need to design an efficient energy management system to achieve a normalized trend of power consumption. Smart grid has been evolved as a solution, where Demand Response (DR) strategy is used to modify the nature of demand of consumer. In return, utility pay incentives to the consumer. The increasing load demand in residential area and irregular electricity load profile have encouraged us to propose an efficient Home Energy Management System (HEMS) for optimal scheduling of home appliances. In order to meet the electricity demand of the consumers, the energy consumption pattern of a consumer is maintained through scheduling the appliances in day-ahead and real-time bases. In this paper we propose a hybrid algorithm Bacterial foraging Ant colony optimization is proposed (HB-ACO) which contain both BFA and ACO properties. Primary objectives of scheduling is to shift load from On-peak hour to Off-peak hours to reduce electricity cost and peak to average ratio. A comparison of these algorithms is also presented in terms of performance parameters electricity cost, reduction of PAR and user comfort in term of waiting time. The proposed techniques are evaluated using two pricing scheme time of use and critical peak pricing. The HB-ACO shows better performance as compared to ACO and BFA which is evident from the simulation results Moreover the concept of coordination among home appliances is presented for real time scheduling. We consider this is knapsack problem and solve it through Ant colony optimization algorithm.