President Bola Tinubu has approved the payment plan to finally settle the outstanding debts under the Presidential Power Sector Financial Reforms Programme.
According to a statement on Sunday by the Special Adviser to the President on Information and Strategy, Bayo Onanuga, the debt repayment plan followed the final review of the legacy debts that have beset the power sector for more than a decade.
“The long-standing debts accumulated between February 2015 and March 2025. Following verification, N3.3tn has been agreed upon as a full and final settlement, ensuring a fair and transparent resolution,” the statement said.
Onanuga disclosed that implementation has begun, with 15 power plants signing settlement agreements totalling N2.3tn. “The Federal Government has already raised N501bn to fund these payments. Out of the amount, N223bn has been disbursed, with further payments underway,” Onanuga disclosed.
According to him, this means that power generation will be more stable.
“What this means for Nigerians: With payments reaching the power value chain, generation will be more stable. With power plants supported, electricity reliability will improve. And as the sector stabilises, more investment, more jobs, and better service will follow,” the statement added.
Onanuga quoted the Special Adviser on Energy to President Tinubu, Olu Arowolo-Verheijen, saying, “This programme is not just about settling legacy debts. It is about restoring confidence across the power sector — ensuring gas suppliers are paid, power plants can keep running, and the system begins to work more reliably. It is part of a broader set of reforms already underway—including better metering and service-based tariffs that link what you pay to the quality of electricity you receive.
“The government is also prioritising power supply to businesses, industries, and small enterprises—because reliable electricity is critical to creating jobs, supporting livelihoods, and growing the economy. The goal is simple: more reliable power for homes, stronger support for businesses, and a system that works better for all Nigerians.”
Tinubu has commended all stakeholders who supported efforts to resolve the legacy issues in the power sector. He has also confirmed that the next phase (Series II) will begin this quarter.
The PUNCH recalls that the Chief Executive Officer of the Association of Power Generation Companies, Dr Joy Ogaji, disclosed that gas suppliers halted supply to thermal power plants over an estimated N3.3tn debt owed by power generation companies, a development that has since deepened the nationwide power shortage.
Speaking on the situation, Ogaji explained that the crisis stems from the failure of the Nigerian Bulk Electricity Trading Plc to fully pay for electricity generated by GenCos since the sector’s privatisation. According to her, the government currently owes generation companies about N6.8tn, with roughly 70 per cent of the amount relating to thermal plants.
“From 2015 to December 2024, the debt profile grew to N4tn. In each month of 2025, there is a shortfall of N200bn, so if you calculate N200bn times 12, that is N2.4tn, making the whole debt N6.4tn after December 2025. We’re already in March 2026. The debt grew to N6.6tn in January and N6.8tn in February. At the end of March, you need to add N200bn again to make it N7tn,” she said.
Ogaji added that a significant portion of the outstanding debt is owed to gas suppliers because thermal plants account for the majority of electricity generation on the national grid.
However, the figure from the GenCos is in sharp contrast with what was approved by the president.
