One of the objectives of PLN’s Electricity Supply Business Plan (RUPTL) 2021–2030 is to reduce energy losses in transmission and distribution networks. Efforts to decrease technical losses have been carried out through the use of amorphous core transformers and natural ester insulating oil. This study designs, develops, and tests a green distribution transformer that integrates both technologies into a single unit. The transformer design considers technical specifications and construction requirements with low limits for both no-load and load losses. The developed prototype was tested using standard methods, and the results show that the transformer successfully passed all technical tests, including voltage ratio measurement, loss measurement, dielectric strength, noise level, short-circuit withstand, and temperature rise tests. An economic analysis using the total cost of ownership (TCO) method demonstrates that although the initial cost is higher, the TCO of the green distribution transformer is lower than that of conventional transformers, with a breakeven point between the 6th and 9th year of operation. The implementation of green distribution transformers has the potential to reduce distribution energy losses by 17.64 million kWh per year, decrease carbon emissions by 1.722 tons of CO₂e annually, and lower electricity production costs by IDR 28,212 billion per year. These findings confirm that green distribution transformers are more efficient, environmentally friendly, and economically viable in the long term, while also supporting the transition toward a more sustainable power system.