In this contributed article we review our method, referred to as QM/MM-ER, which combines the hybrid QM/MM simulation with the theory of energy representation. Our recent developments and applications related to the method are also introduced. First, we describe the parallel implementation of the Kohn-Sham DFT for the QM region that utilizes the real-space grids to represent the one-electron wave functions. Then, the efficiency of our code on a modern parallel machine is demonstrated for a large water cluster with an ice structure. Secondly, the theory of energy representation (ER) is formulated within the framework of the density functional theory of solutions and its application to the free energy analyses of the protein hydration is provided. Thirdly, we discuss the coupling of the QM/MM approach with the method of energy representation, where the formulation for free energy δμ due to the electron density fluctuation of a QM solute plays a key role. As a recent progress in QM/MM-ER we developed a rigorous free energy functional to compute free energy contribution δμ. The outline of the method as well as its extension to the QM/MM simulation coupled with a second-order perturbation approach are described.