The Millenium Challenge Account-Nepal (MCA-Nepal) on Thursday signed a contract for the construction of a new substation in Nawalparasi.

MCA-Nepal, the body responsible for implementing the MCC projects in the country, in a press release said that the contract for the construction of the 400kV New Butwal Substation in Nawalparasi was awarded to Linxon India Pvt Ltd.

The project is expected to be completed in 39 months.

The signing ceremony, which took place in Bhumahi, Nawalparasi, was attended by Nepal Electricity Authority Managing Director Kulman Ghising and Dean R Thompson, American envoy to Nepal, among others.

“The 400 kV New Butwal Substation will improve Nepal’s transmission capacity contributing to reliable and affordable electricity for household consumption, expanded commercial and industrial enterprises and cross-border electricity trading,” Thompson said at the event.

Stating that the substation had been a priority for the NEA, Ghising said that the project would supplement the existing 220 kV substation to significantly increase cross-border energy trade in the region.

Along with the Nawalparasi-based substation, two others are being built in Nuwakot and Tanahun under the Electricity Transmission Project jointly funded by the Millennium Challenge Corporation (MCC) and the Government of Nepal.

The MCA-Nepal board, chaired by the secretary at the Ministry of Finance, in its March board meeting, decided to advance the 18km Nepal portion of the New Butwal-Gorakhpur power transmission line to facilitate timely initiation of cross-border power trade as outlined in the agreement with India.