FG begins N4tn debt settlement, captures five GenCos

The Federal Government has taken steps towards resolving Nigeria’s estimated N4tn power sector debt burden as five power generation companies signed settlement agreements under the Presidential Power Sector Debt Reduction Programme, following the issuance of a N501bn bond.

The bond, which reportedly recorded 100 per cent subscription, was issued in Lagos on Tuesday, attracting interest from pension funds, banks, asset managers, and other institutional investors, signalling renewed confidence in the government’s electricity market reforms and its approach to resolving legacy sector challenges.

The programme, driven by President Bola Tinubu, is designed to address payment arrears owed to power generation companies for electricity supplied over the past decade. The PUNCH reports that the legacy debts had constrained liquidity, weakened balance sheets, and discouraged investment across the Nigerian Electricity Supply Industry.

Speaking at the signing ceremony, the Managing Director of the Nigeria Bulk Electricity Trading Plc, Johnson Akinnawo, described the programme as a historic and defining moment for Nigeria’s power sector.

“This historic programme received the resolute approval of President Bola Tinubu and the Federal Executive Council. Mr President’s decisive endorsement is not just a procedural step; it is the bedrock of this ambition. It signals the highest level of commitment to the total revitalisation of our nation’s power sector,” Akinnawo said.

He added that the development would strengthen market discipline while enabling growth across generations and other segments of the electricity value chain.