By George Ozalla
President Bola Tinubu has approved a N3.3 trillion payment plan to settle outstanding debts in the power sector under the Presidential Power Sector Financial Reforms Programme, in a move aimed at restoring liquidity, stability, and confidence across Nigeria’s electricity value chain. The announcement was made in a State House press release signed by Bayo Onanuga, Special Adviser to the President on Information and Strategy.
The decision follows the final review of legacy debts that have accumulated in the sector over more than a decade. The verified obligations, spanning February 2015 to March 2025, were reconciled and agreed at a final settlement figure of N3.3 trillion.
Implementation has already commenced, with 15 power generation companies signing settlement agreements valued at about N2.3 trillion. The Federal Government said N501 billion has been raised to support the programme, of which N223 billion has already been disbursed, with further payments underway.
The Presidency said the intervention is expected to ease financial pressure on power generation companies, improve payments to gas suppliers, and strengthen overall electricity generation, with anticipated improvements in supply reliability for homes and businesses.
Special Adviser to the President on Energy, Olu Arowolo-Verheijen, explained that the initiative goes beyond debt clearance, forming part of broader reforms aimed at rebuilding confidence in the sector and improving system performance. She noted that reforms also include improved metering and service-based tariffs that link electricity costs to supply quality, while prioritising energy access for businesses, industries, and small enterprises.
According to Verheijen, the reforms aim to strengthen the power value chain, attract investment, create jobs, and support economic growth through more reliable electricity.
President Tinubu commended stakeholders involved in resolving the legacy debts and confirmed that the next phase of the reform programme, Series II, will begin this quarter.
