Kathmandu: The Millennium Challenge Account Nepal Development Committee (MCA-Nepal) has signed a contract with the Indian company Techno Electric and Engineering Ltd for the construction of a 400KV substation in Damauli, Tanahu. The project, valued at 38.89 million USD, is part of the broader MCC Nepal Compact initiative.

The contracts for all three 400KV substations under the MCC Nepal Compact have now been finalized. MCA-Nepal's Executive Director Khadga Bahadur Bista and Trade Director of Techno Electric and Engineering Ltd Rajiv Agrawal signed the contract during a function attended by Energy Minister Deepak Khadka and US Ambassador to Nepal Dean Thompson in Kathmandu on Wednesday.

Energy Minister Khadka highlighted the importance of the substation contract, stating that it would strengthen the electricity distribution system and pave the way for the country’s economic prosperity. He urged all stakeholders to work diligently to ensure the timely completion of the project.

Dr. Ram Prasad Ghimire, Chair of the MCA-Nepal Board of Directors and Secretary at the Finance Ministry, praised the progress made under the MCC-Nepal Compact. He emphasized that the construction of these substations would significantly enhance Nepal's energy infrastructure, boosting industrial and trade activities while ensuring a sustainable power supply.

Ambassador Thompson expressed his appreciation for the collaborative efforts of the Nepal government, Finance Ministry, Energy Ministry, Nepal Electricity Authority (NEA), and MCA-Nepal. He noted that the MCC-Nepal Compact plays a crucial role in ensuring electricity access for all households and supporting inclusive and sustainable economic development, thereby contributing to job creation and poverty reduction.

Executive Director Bista remarked that completing the signing of contracts for the three substations within a year of the project's initiation is a significant milestone. The Damauli substation, upon completion, will be critical for transmitting electricity from Ratmate, Lekhnath, and the New Butwal Substation.

The MCC-Nepal Compact provides financial support for building these three substations to ensure a reliable power supply along the 314-km transmission line from Lapsephedi in Kathmandu to Bardaghat Susta in Nawalparasi, extending to the border with India.