This paper proposes a modular multilevel converter (MMC) topology for high-voltage dc (HVdc) system applications. The proposed MMC employs two half-bridge converters, a cascade of networks that consist of electronic switches, and multiple capacitors. Thus, charged capacitors are inserted in series with the arm current path, for a desired level of the output ac voltage. The switches that must be turned <sc>on</sc> are judiciously selected for the most efficient current path. The proposed MMC also offers dc-side fault handling capability. The paper compares the proposed MMC with the half-bridge submodule-based MMC, full-bridge submodule-based MMC, and clamp-double submodule-based MMC technologies. It is shown that the proposed MMC is more efficient than the three aforementioned MMC technologies, while it offers the same fault handling capability as that of an equivalent full-bridge-based MMC. Time-domain simulation studies confirm the effectiveness of the proposed MMC under various normal and faulted operating scenarios, using detailed as well as reduced models.