In a significant stride towards bolstering Nepal’s energy infrastructure and facilitating cross-border energy trade, the Millennium Challenge Account-Nepal (MCA-Nepal) has inked a contract agreement for the construction of the New Butwal Substation. This pivotal project is being funded through a grant from the US Mission Millennium Challenge Corporation (MCC), marking the first construction contract under the MCC project in Nepal.
On Thursday, MCA-Nepal signed the deal with Linkson India Pvt Ltd for the construction of the 400 KV New Butwal substation, which will be located in Nawalparasi (Bardghat Susta West). As per the agreement, the substation’s construction must be completed within a period of 39 months.
The contract signing ceremony was held in the presence of esteemed dignitaries, including the US Ambassador to Nepal, Dean R. Thompson, the Executive Director of the Nepal Electricity Authority, Kulman Ghising, and other officials. MCA-Nepal Executive Director Khadga Bahadur Bista and representatives from Linkson India affixed their signatures to the agreement during the event.
Addressing the gathering, Ambassador Thompson emphasized the compact’s significance in addressing Nepal’s energy needs, underscoring the US government’s commitment to collaborating with the Nepali government to ensure the project’s successful implementation. “This 400 kV New Butwal substation will enhance Nepal’s power transmission capacity, providing reliable and affordable electricity for domestic consumption, expanded business and industrial operations, as well as cross-border electricity trade,” he stated.
Kulman Ghising, the Executive Director of the Nepal Electricity Authority, highlighted the substation’s importance as a priority project for the authority. He further added that the substation will contribute significantly to cross-border energy trade and complement the existing 220 kV substation.
During the program, MCA-Nepal Executive Director Bista provided updates on the overall progress being made in implementing the MCC Nepal Compact. “MCA-Nepal is rapidly advancing all work related to the construction of transmission lines and substations under the power transmission project,” he informed.
As part of this project, MCA-Nepal is constructing three substations. The remaining two substations are being built in Ratmate, Nuwakot, and Damauli, Tanahun. The financial proposals submitted by technically qualified contractors for the construction of these two substations have also been opened. Bista revealed that final preparations are underway for signing contracts for the construction of the remaining two substations.
In a move to expedite cross-border energy trade, the MCA-Nepal Board of Directors, during its meeting in February, decided to immediately proceed with the construction of the 18 km section of the New Butwal-Gorkhpur power transmission line within the Nepali territory. Consequently, bids for that section have been invited.
