The Federal Government has finalized the implementation framework for President Bola Ahmed Tinubu’s ₦4 trillion Presidential Power Sector Debt Reduction Plan, marking a major step toward restoring financial stability and investor confidence in Nigeria’s electricity market.
The plan, which was approved by President Tinubu and endorsed by the Federal Executive Council in August, authorizes the issuance of government-backed bonds to settle verified arrears owed to generation companies (GenCos) and gas suppliers.
A high-level meeting to review the settlement modalities was held on October 7, 2025, in Abuja. It was attended by Minister of Finance and Coordinating Minister of the Economy, Wale Edun, Minister of Power, Chief Bayo Adelabu, and Special Adviser to the President on Energy, Olu Verheijen, alongside senior executives from power generation companies.
The meeting concluded with an agreement to conduct bilateral negotiations that will lead to full and final settlement arrangements balancing fiscal realities with the financial constraints of GenCos.
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Industry leaders have hailed the initiative as a long-awaited step toward resolving liquidity challenges that have stifled growth in the sector.
“For the first time in years, we are seeing a credible and systematic effort by government to tackle the root liquidity challenges in the power sector,” said Tony Elumelu, Chairman of Heirs Holdings and Transcorp Power.
Kola Adesina, Group Managing Director of Sahara Group, added that the initiative “gives renewed confidence in the reform process and a clear signal that the government is serious about building a sustainable power sector.”
According to the Presidency, the plan is not just about clearing arrears but resetting Nigeria’s electricity market. By improving the financial health of power companies, it is expected to unlock new investments, modernize grid infrastructure, and enhance power reliability for homes and businesses nationwide.
“Our focus is on creating the right conditions for investment—from modernizing the grid and scaling embedded generation to improving subsidy targeting,” said Olu Verheijen, the President’s energy adviser.
Wale Edun noted that the reforms aim to rebuild the fundamentals of the sector so it can “work for investors, for citizens, and for the next generation.”
Complementary measures are also underway to scale renewable energy, leverage domestic gas as a transition fuel, and strengthen local technical capacity, all aimed at achieving energy security and positioning Nigeria as one of Africa’s most attractive power markets.
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 stakeholders.
