By Micah Jonah
January 28, 2026
The Federal Government has commenced steps to resolve Nigeria’s estimated N4tn power sector debt as five power generation companies signed settlement agreements under the Presidential Power Sector Debt Reduction Programme, following the issuance of a N501bn bond.
The bond, which reportedly recorded 100 percent subscription, was issued in Lagos on Tuesday, attracting interest from pension funds, banks, asset managers and other institutional investors, signalling renewed confidence in the government’s electricity market reforms and its approach to resolving legacy sector challenges.
The programme, driven by President Bola Tinubu, is designed to address payment arrears owed to power generation companies for electricity supplied over the past decade. The legacy debts had constrained liquidity, weakened balance sheets and discouraged investment across the Nigerian Electricity Supply Industry.
Speaking at the signing ceremony, the Managing Director of the Nigeria Bulk Electricity Trading Plc, Johnson Akinnawo, described the programme as a historic and defining moment for Nigeria’s power sector.
He said the programme received the approval of President Bola Tinubu and the Federal Executive Council, noting that it signals the highest level of commitment to the revitalization of the nation’s power sector and would strengthen market discipline while enabling growth across the electricity value chain.
The Special Adviser to the President on Energy, Olu Verheijen, said the bond issuance marked a decisive reset of the electricity market, combining debt resolution with broader financial and structural reforms aimed at restoring confidence and long term sustainability to the sector.
She explained that the Series One Power Sector Bond, executed by NBET Finance Company Plc, closed at N501bn, comprising N300bn raised from the capital market and N201bn allotted in bonds to participating generation companies.
Verheijen disclosed that five generation companies operating 14 power plants nationwide First Independent Power Limited, Geregu Power Plc, Ibom Power Company Limited, Mabon Limited and the Niger Delta Power Holding Company Limited have executed settlement agreements with NBET, with a total negotiated settlement value of N827.16bn to be paid in four phased instalments.
She added that when fully implemented, the programme is expected to impact over 4,400 megawatt hours of electricity generation capacity, provide a strong foundation for new investments while improving power supply to millions of electricity customers nationwide.
