SATV, Kathmandu, Jun. 11 - The Millennium Challenge Account Nepal (MCA-Nepal) on Wednesday formally began construction work on two substations and a transmission line under the Millennium Challenge Corporation (MCC) Nepal Compact, marking a key step in the country’s energy transmission development.
The groundbreaking covers the Ratmate Substation in Nuwakot, the New Damauli Substation, and a 297-kilometre electricity transmission line.
This historic partnership—combining a USD550 million grant from the United States and a USD 197 million investment from the government of Nepal—is building world-class electricity transmission infrastructure and upgrading vital road networks.
A formal ceremony held at the Ratmate Substation site brought together senior government officials, representatives of MCC and the US Embassy, development partners, contractors, local stakeholders, and community leaders, according to a statement issued by MCA-Nepal
Jointly funded by the governments of Nepal and the United States through the MCC Nepal Compact, the Electricity Transmission Project will construct high-capacity 400kV substations and 315km of transmission lines.
The 297km transmission line network includes the Ratmate–New Damauli and New Damauli –New Butwal corridors, as well as the Lapsiphedi–Ratmate–New Hetauda section.
“Strengthening electricity transmission infrastructure is essential to ensuring energy security, promoting investment and industrial growth, and maximising the benefits of Nepal’s energy potential," said Dr. Ghanshyam Upadhyaya, Secretary of the Ministry of Finance and MCA-Nepal Board Chair. U.S. Chargé d’Affaires a.i. Scott Urbom reaffirmed the United States’ longstanding partnership with Nepal and its commitment to the MCC Nepal Compact.
“Through this Compact, we are building the backbone of Nepal's energy future. Reliable power will flow across the country and beyond its borders. For families, this means lights that stay on. For factories and farms, it means steady energy to drive production. For Nepali businesses, it unlocks new horizons for growth,” he said.
MCC Resident Country Director Diane Francisco emphasised the long-term significance for Nepal’s economic growth and regional energy integration.
Dirghayu Kumar Shrestha, Acting Managing Director at NEA, said, "The infrastructure being constructed under the MCC Nepal Compact is not a standalone system; it is an important addition to Nepal's national transmission network." MCA-Nepal Executive Director Khadga Bahadur Bisht said, “Today marks a major milestone in Nepal’s energy infrastructure development. This stronger, more reliable, and future-ready electricity transmission network will benefit generations of Nepalis and position Nepal as a key player in regional energy markets.”
Four contractors are executing the work: Techno Electric and Engineering Company Ltd., India, is carrying out the construction of the Ratmate and New Damauli substations. Ashish–Bozlar JV is constructing the 117km Lapsiphedi–Ratmate–New Hetauda transmission line section; and Angelique–Skipper JV and Waiba–Salasar JV are undertaking the construction of the Ratmate–New Damauli and New Damauli–New Butwal transmission line sections, respectively. Each section spans approximately 90 kilometers.
Once completed, the Ratmate and New Damauli substations will rank among Nepal’s largest high-voltage substations.
