The Nigerian Bulk Electricity Trading Plc (NBET) has commenced the settlement of N728.979 billion in outstanding obligations to electricity generation companies (GenCos) and their associated gas suppliers.
NBET Managing Director and Chief Executive Officer, Akin Odeyemi, announced this on Friday, October 9, following the successful issuance and signing of the Series 2 bonds under the Federal Government’s N4 trillion Power Sector Multi-Instrument Issuance Programme.
The settlement comprises N402 billion in cash bonds and N326.979 billion in non-cash bonds, bringing the total to N728.979 billion.
The programme is designed to settle verified outstanding debts owed to generation companies for electricity supplied between February 2015 and March 2025.
The accumulated obligations have constrained liquidity across the electricity value chain, affecting generation companies’ ability to maintain power plants, invest in additional capacity and meet payments to gas suppliers.
Series 2 Covers 11 Generation Companies
The second series covers 11 generation companies, compared with eight under Series 1, which was completed in January 2026.
The issuance was oversubscribed, attracting interest from pension fund administrators, banks, sovereign wealth funds, asset managers and other investors.
Africa Finance Corporation served as co-financial adviser, while CardinalStone Partners acted as lead financial adviser and lead issuing house.
The Series 2 issuance follows the N501.021 billion raised under the first series, bringing the total value of bonds issued under the programme to approximately N1.23 trillion.
Oyedele Stresses Need for Power Sector Reforms
The Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, described the programme as a structured approach to settling legitimate historical obligations and strengthening confidence in the electricity market.
He, however, stressed that debt settlement alone would not resolve the sector’s financial challenges.
Oyedele said improved revenue collection, stronger payment discipline, reduced technical and commercial losses, and greater accountability were necessary to prevent fresh arrears from accumulating.
The Federal Government aims to improve liquidity in electricity generation and gas supply, enabling market participants to meet their obligations and creating conditions for additional investment.
Settlement Expected to Ease Financial Pressure
The settlement could ease financial pressure on generation companies and gas suppliers, helping them meet operating costs, maintain equipment and ensure reliable fuel supplies to thermal power plants.
However, the improved financial position of the companies may not immediately translate into increased electricity supply to consumers.
The impact will depend on the implementation of the settlement, how companies deploy the funds and whether persistent challenges involving gas supply, transmission infrastructure and market revenues are addressed.
The programme is part of the government’s broader effort to strengthen the financial position of the power sector and improve the sustainability of electricity generation and supply.
