President Bola Ahmed Tinubu has approved a structured payment plan to settle a staggering N3.3 trillion debt burden in Nigeria’s power sector, in a move aimed at stabilising electricity supply and restoring investor confidence.
Gatekeepers News reports that according to a statement by presidential spokesperson Bayo Onanuga, the initiative falls under the Presidential Power Sector Financial Reforms Programme and targets long-standing liabilities accumulated between 2015 and 2025.
The debt, owed largely to power generation companies (GenCos) and gas suppliers, has threatened operations in the sector, with some gas firms previously warning they could halt supply due to unpaid obligations.
Following a verification process, the federal government agreed on N3.3 trillion as a full and final settlement of the legacy debts. Implementation has already begun, with about 15 power plants signing agreements worth N2.3 trillion.
To kick-start the process, the government has raised N501 billion, out of which N223 billion has already been disbursed, while additional payments are ongoing.
Officials say the repayment plan is expected to improve liquidity across the power value chain, ensure gas suppliers are paid, and enable power plants to operate more efficiently. This, in turn, should lead to more stable electricity generation and improved supply nationwide.
The presidency also noted that the initiative goes beyond debt settlement, forming part of broader reforms such as improved metering and service-based tariffs. These measures are designed to enhance service delivery and align electricity costs with quality of supply.
The next phase of the programme is expected to commence later this quarter, as the government seeks to fully reset the financial structure of the power sector and attract new investments.
