President Bola Ahmed Tinubu has approved a comprehensive payment plan to settle longstanding debts in Nigeria’s power sector, marking a major step toward stabilising electricity supply across the country.
The initiative, implemented under the Presidential Power Sector Financial Reforms Programme, follows a final review of legacy debts that have weighed down the sector for over a decade.
The liabilities, accumulated between February 2015 and March 2025, have now been pegged at ₦3.3 trillion as a full and final settlement after a verification process aimed at ensuring transparency and fairness.
Implementation of the repayment plan is already underway, with 15 power generation companies signing settlement agreements worth ₦2.3 trillion. The Federal Government has raised ₦501 billion to kick-start the process, out of which ₦223 billion has been disbursed, while additional payments are ongoing.
The development is expected to bring immediate relief across the electricity value chain, particularly for power generation companies struggling with liquidity challenges. Improved cash flow is projected to enhance generation capacity and ultimately lead to more stable and reliable electricity supply for Nigerians.
Special Adviser to the President on Energy, Olu Arowolo-Verheijen, said the programme goes beyond debt repayment, describing it as a strategic effort to rebuild confidence in the sector.
“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,” she said.
She added that the initiative forms part of broader reforms, including improved metering and the implementation of service-based tariffs designed to align electricity costs with quality of supply. According to her, the government is also prioritising power delivery to industries, businesses, and small enterprises to drive economic growth and job creation.
President Tinubu commended stakeholders for their contributions toward resolving the sector’s longstanding challenges and confirmed that the next phase of the programme, Series II, will commence later this quarter.
The reform programme is widely seen as a critical intervention aimed at repositioning Nigeria’s power sector for sustainable growth, improved service delivery, and increased investment.
