Transmission loss represents one of the main challenges in the Java-Madura-Bali (Jamali) electrical system, particularly in the Paiton subsystem which serves as a strategic power supply point to Bali Island. This research aims to determine the optimal location for constructing a 500 kV Extra High Voltage Substation (GITET) to reduce transmission loss and improve system reliability. The method involves quasi-dynamic power flow simulation with electrical network modeling using PSS/E software integrated with Python. Time-series simulations were conducted throughout 2025 for several alternative locations: Watudodol, Jember, Genteng, and Banyuwangi.Research results show that constructing a new GITET in Banyuwangi can reduce transmission losses by up to 77.5% (from 420.57 GWh to 94.71 GWh), making it the most technically optimal location. However, from a financial perspective, the Banyuwangi site is not considered viable. On the other hand, the Jember location achieves a 55.4% reduction in transmission loss and offers the most favorable financial parameters, with an Internal Rate of Return (IRR) of 15.01%, a Net Present Value (NPV) of Rp 4.47 trillion, and a payback period of 9.35 years.Therefore, the ideal location for GITET construction in the Paiton subsystem is Jember, considering the balance between technical efficiency and financial feasibility