Tinubu Approves Plan to Clear N3.3trn Power Sector Debt

President Bola Tinubu has approved a structured payment plan to settle N3.3 trillion in outstanding debts within Nigeria’s power sector, under the presidential power sector financial reforms programme.

The development was disclosed on Sunday by Bayo Onanuga, the president’s special adviser on information and strategy.

The move follows concerns raised by the Association of Power Generation Companies (APGC), which warned that gas suppliers could halt supply to thermal plants over debts estimated at N3.3 trillion. Earlier, the group had put the federal government’s total debt to generation companies (GenCos) at about N6.5 trillion.

Onanuga said the repayment plan came after a final review of long-standing liabilities accumulated between February 2015 and March 2025. He noted that N3.3 trillion was agreed upon as a full and final settlement after verification.

According to him, implementation is already underway, with 15 power plants signing settlement agreements worth N2.3 trillion. The federal government has so far raised N501 billion, out of which N223 billion has been disbursed, with further payments ongoing.

He added that the injection of funds into the power value chain would stabilise electricity generation and improve supply reliability, while also boosting investor confidence, job creation, and service delivery.

Tinubu also commended stakeholders involved in resolving the sector’s legacy issues, noting that the next phase of the programme is expected to begin within the current quarter.

Speaking on the initiative, Olu Arowolo-Verheijen, special adviser to the president on energy, said the programme is aimed not only at clearing debts but also at restoring confidence in the sector and ensuring gas suppliers are paid.

She explained that the reforms would help sustain power plant operations and improve system reliability. The plan, she added, is part of broader reforms, including improved metering and service-based tariffs that align electricity costs with quality of supply.

Arowolo-Verheijen further noted that the government is prioritising electricity supply to businesses, industries, and small enterprises, stressing that reliable power is key to economic growth, job creation, and improved livelihoods.

She said the overall goal is to deliver more reliable electricity to homes, strengthen support for businesses, and create a more efficient power system for Nigerians.