The Millennium Challenge Account-Nepal (MCA-Nepal) has started construction of a new 400 kV substation here in Damauli.

Khadga Bahadur Bisht, Executive Director of MCA-Nepal, said that construction of the Damauli substation has begun from April 17, 2025 in Vyas Municipality-13.

He said that the construction of the substation has started as per a contract agreement signed with Techno Electric and Engineering Limited of India on July 31, 2024.

MCA-Nepal had signed contract with Techno Electric and Engineering Company Ltd. India to construct a 400 kV substation with US$ 38.89 million investment in Damauli, Tanahun district.

Once completed, the new Damauli substation will have a capacity of 1000 Mega Volt Ampere, making it one of the largest substations in the country along with the Ratmate substation for which the MCA-Nepal signed a contract with the same company in June 2024.

According to Bisht, the new Damauli substation will serve as an important conduit for power transmission between Ratmate, Lekhnath and New Butwal substations.

All three substations will make a significant contribution to strengthening Nepal's power distribution system.

Along with the three substations, the MCC Nepal Compact is providing financial support for the construction of up to 315 km of transmission line from Lapsiphedi, Kathmandu to the Nepal-India border in Nawalparasi (Bardaghat Susta West) under the Electricity Transmission Project.

Currently, the construction of an 18 km long cross-border transmission line is underway.

Similarly, work has begun for the construction of the remaining 297 km transmission line.