The Federal Government says it has finalised the implementation framework for the Presidential Power Sector Debt Reduction Plan to address structural bottlenecks and lay the groundwork for large-scale private sector-led investment and sustained economic growth.
A statement by the Media and Communications Unit Office of the Special Adviser to the President on Energy, Senan Murray, stated that on Tuesday, 7 October 2025, the Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, the Minister of Power, Chief Bayo Adelabu, and the Special Adviser to the President on Energy, Mrs. Olu Verheijen, met with senior executives of Nigeria’s electricity generation companies (GenCos) to review settlement modalities for the outstanding debt.
It said the meeting concluded with a consensus on the way forward, which includes conducting bilateral negotiations to finalize full and final settlement agreements that balance fiscal realities with the financial constraints of the GenCos.
“Approved by President Tinubu and endorsed by the Federal Executive Council (FEC) in August 2025, the plan authorizes the issuance of up to N4trn in government-backed bonds to settle verified arrears owed to generation companies and gas suppliers. This intervention, the largest in over a decade, addresses a legacy debt overhang that has constrained investment, weakened utility balance sheets, and hindered reliable power delivery across the country.”
“For the first time in years, we are seeing a credible and systematic effort by the government to tackle the root liquidity challenges in the power sector,” said Mr. Tony Elumelu, Chairman of Heirs Holdings and Transcorp Power, adding, “We commend President Tinubu and his economic team for this bold and transformative step.”
Beyond clearing arrears, the debt reduction plan signals a strategic reset of Nigeria’s electricity market.
By restoring the financial health of power companies, it will enable new investment in generation capacity, modernize grid infrastructure, and deliver more reliable electricity to homes and businesses, creating a stronger foundation for industrialization, job creation, and inclusive economic growth.
“Our focus is on creating the right conditions for investment, from modernizing the grid and improving distribution to scaling embedded generation,” said Olu Verheijen, Special Adviser to the President on Energy.
“By closing metering gaps, aligning tariffs with efficient costs, improving subsidy targeting to support the poor and vulnerable, and restoring regulatory trust, we are shifting from crisis response to sustained delivery and building the confidence needed to attract large-scale private capital.”
