The Federal Government has concluded implementation frameworks for a ₦4 trillion government-backed bond programme aimed at settling verified arrears owed to power Generation Companies (GenCos) and gas suppliers.
This was disclosed by the Special Adviser to the President on Energy, Mrs Olu Verheijen, in a statement issued by her media aide, Senan Murray, in Abuja.
According to the statement, the agreement was reached during a high-level meeting between federal government officials and senior executives of GenCos to review modalities for the debt settlement. The meeting was attended by the Minister of Finance and Coordinating Minister of the Economy, Mr Wale Edun; the Minister of Power, Chief Bayo Adelabu; and Mrs Verheijen.
“The meeting concluded with a consensus on the way forward, which includes bilateral negotiations to finalise full and final settlement agreements that balance fiscal realities with the financial constraints of the GenCos,” Murray stated.
He described the initiative as “the largest intervention in over a decade,” addressing a long-standing debt overhang that has constrained investment, weakened utility balance sheets, and hindered reliable power delivery across the country.
“This is a major step by the Federal Government toward restoring financial stability and investor confidence in the electricity market,” he added.
Murray explained that the plan followed the approval of President Bola Tinubu and the Federal Executive Council for a comprehensive reform designed to eliminate structural bottlenecks and lay the groundwork for private sector-led investment and sustained economic growth.
During the meeting, Verheijen noted that the government’s focus was on creating the right conditions for investment by modernising the grid, improving power distribution, and scaling embedded generation.
She said the reforms would also help close metering gaps, align tariffs with efficient costs, improve subsidy targeting to protect vulnerable citizens, and restore regulatory trust.
“The sector is shifting from crisis response to sustained delivery and building the confidence needed to attract large-scale private capital,” Verheijen said.
Also speaking, the Minister of Finance, Mr Wale Edun, said the reforms went beyond liquidity measures, emphasising the need to rebuild the fundamentals of the power sector.
“This is how we create the enabling condi tions for sustained private investment and transform reliable power into a catalyst for economic growth,”Edun stated.
He added that the complementary efforts to scale renewable energy, leverage domestic gas as a transition fuel, and build local technical capacity would position Nigeria for both energy security and sovereignty, making it one of Africa’s most attractive power markets.
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Business leaders at the meeting, including Mr Tony Elumelu, Chairman of Heirs Holdings and Transcorp Power, and Mr Kola Adesina, Group Managing Director of Sahara Power Group, commended President Tinubu’s administration for what they described as a credible and systematic effort to resolve the sector’s liquidity challenges.
Elumelu praised the initiative as a bold and transformative step, while Adesina said it renewed confidence in the reform process and signalled a strategic reset of Nigeria’s electricity market.
The Presidential Power Sector Debt Reduction Plan is being jointly implemented by the Federal Ministry of Finance, the Federal Ministry of Power, and the Office of the Special Adviser to the President on Energy, in collaboration with the Nigerian Bulk Electricity Trading (NBET) Plc and other key stakeholders.
President Tinubu had earlier assured the GenCos of his administration’s commitment to clearing outstanding debts following a thorough audit process, reiterating his determination to resolve the liquidity challenges affecting Nigeria’s power sector.
