Substation construction is being invested into more than ever before. This is partly due to the ongoing energy revolution, but also to the need to restructure aging network assets. Ensuring the cost-effective implementation of projects is a very topical issue for distribution system operators. In this thesis done for Caruna Oy, the possibilities for increasing the cost-effectiveness of the 110/20 kV substation project were investigated. The study was started with a cost structure study of the substation project. As a result of the study, the most important cost components in the substation project were identified with the help of three example projects. Based on the identified cost components, it was determined at which point in the project each component will be implemented and when its amount can be influenced. The study was supplemented by an interview study, which aimed to reveal how the amount of the cost components identified in the cost structure study can be influenced during the project. A total of 17 people were interviewed for the thesis. The interviewees consisted of Caruna’s HV projects, procurement, maintenance, and general design team representatives as well as external stakeholders such as pre-design partner and contractors. As a result of the study, several development proposals were identified to increase cost efficiency in Caruna’s substation projects. The research of the work was primed with a literature review focusing on the substation and project management theory. In addition, a concise overview of the prospects of the electricity grid system and substation construction was compiled by utilizing both interview and literature sources. The key conclusion of the thesis is that it is not possible to achieve cost efficiency by doing some individual part correctly. A cost-effective project is an entity formed by the cost-effective stages of a project's life cycle. A cost-effective 110/20 kV substation is built on a high-quality and collaborative plan, on a carefully selected site where possible, with high-quality and reliable equipment that is safe to use and as maintenance-free as possible, and proactively managed from start to finish. Long-term cost-effectiveness and life cycle thinking, as well as environmental issues, will be considered even more in the construction of future substations. The modern substation is SF6 gas free and digital.