The Federal Government on Friday kicked off a N1.23 trillion bond issuance aimed at settling long-standing debts owed to power generation companies (Gencos) and gas suppliers, marking the first phase of the Presidential Power Sector Debt Reduction Programme.
The Special Adviser to the President on Energy, Mrs Olu Verheijen, announced the development in a statement which was made available to newsmen on Friday by her media aide, Senan Murray.
Speaking during the launch, Verheijen described the bond issuance as “a strategic reset, not a bailout,” stressing that clearing the verified legacy debts would restore liquidity, boost investor confidence, and enable Gencos to stabilise operations and plan new investments.
“This is not a bailout; it is a strategic reset that clears verified arrears, restores liquidity, and gives power generation companies the footing they require to operate and invest with confidence,” she said.
She revealed that settlement agreements covering 100 per cent of the Phase 1 issuance have been signed with several Gencos, while negotiations with the remaining ones are at advanced stages.
The 7-year fixed-rate bonds, fully guaranteed by the Federal Government, are being issued through NBET Finance Company Plc, with CardinalStone Partners Limited as Lead Issuing House and Financial Adviser.
Over 600 institutional investors, including banks, pension funds, insurance companies, and asset managers, participated in the virtual forum.Minister of Finance and Coordinating Minister of the Economy, Mr Wale Edun, hailed the initiative as “bold and transformative,” reaffirming the Tinubu administration’s commitment to transparency and fiscal discipline.
Minister of Power, Chief Adebayo Adelabu, highlighted significant improvement in sector revenue, noting that Distribution Companies (DisCos) collections rose from ₦1 trillion in 2023 to ₦1.7 trillion in 2024, and are projected to hit ₦2.2 trillion in 2025 following the shift to cost-reflective tariffs.
Approved by President Bola Tinubu and endorsed by the Federal Executive Council in August 2025, the Presidential Power Sector Debt Reduction Programme authorises up to ₦4 trillion in government-backed bonds to resolve decades-old liabilities that have crippled investment and reliable electricity supply.
Mrs Verheijen emphasised that settling old debts is only the first step, warning that preventing new debt accumulation through ongoing market reforms including cost-reflective tariffs, widespread metering, and commercial discipline remains critical for long-term sustainability.
Interested investors can find full details of the bond programme at: https://www.energyreforms.ng/power-sector-bond
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