The electromagnetic properties of heavy fermion CePd₂Si₂ are investigated using density functional theory using the local density approximation (LDA) and LDA+U methods. The Ce f-bands are located near the Fermi energy and hybridized with the Pd-3d states. This hybridization plays an important role in generating the physical characteristics of this compound. The magnetic moment of CePd₂Si₂ calculated within the LDA scheme does not match with the experimental result because of the strong correlation interaction between the f orbitals. The calculation shows that the specific heat coefficient underestimates the experimental value by a factor of 5.98. This discrepancy is attributed to the formation of quasiparticles. The exchange interaction between the local f electrons and the conduction d electrons is the reason for the formation of quasiparticles. The exchange interaction is significant in CePd₂Si₂, which makes the quasiparticle mass increase. This enhances the specific heat coefficient.