The Federal Government has unveiled a major financial intervention in the power sector, with President Bola Tinubu approving a ₦3.3 trillion payment plan to settle long-standing legacy debts accumulated between February 2015 and March 2025.
The initiative aims to restore liquidity to electricity generation companies (GenCos) and gas suppliers, addressing a decade-long crisis that has hampered power generation and supply across the country.
The plan forms part of the broader Presidential Power Sector Financial Reforms Programme.
Key Components of the Plan
Initial Disbursement: The government has raised ₦501 billion through a dedicated bond issuance, with ₦223 billion already disbursed to participating GenCos. Additional payments are in progress.
Multi-Phase Settlement: The ₦3.3 trillion represents a verified full and final settlement. Implementation is underway, with 15 power plants from multiple GenCos signing agreements totaling about ₦2.3 trillion so far.
Focus Areas:
The funds target debts owed to GenCos and gas suppliers, aiming to stabilize the national grid, support the transition to service-based tariffs, and drive structural reforms for more reliable electricity delivery.
This financial reset is expected to unlock stalled generation capacity, improve liquidity in the power value chain, and enhance overall electricity reliability for millions of Nigerians. The government has emphasized transparency and accountability in the phased rollout of payments.
Stakeholders, including several GenCos, have welcomed the move as a critical step toward resolving the sector's chronic challenges. The plan addresses debts that built up over nearly a decade, which had severely affected operations and investment in power infrastructure.
As implementation continues, the success of this intervention could mark a turning point for Nigeria’s electricity sector, potentially leading to improved power supply and greater investor confidence.
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