- Safiu Kehinde
The Federal Government has finalised the settlement of N4 trillion debt owed to the Nigerian electricity generation companies (GenCos).
This was disclosed in a statement issued on Tuesday by Senan Murray from the Office of the Special Adviser to the President on Energy.
In what he described as a major step toward restoring financial stability and investor confidence in the electricity market, Murray maintained that the N4 trillion debt settlement will address structural bottlenecks and lay the groundwork for large-scale private sector-led investment and sustained economic growth.
According to the statement, the Minister of Finance and Coordinating Minister of the Economy, Wale Edun; Minister of Power, Chief Bayo Adelabu; and the Special Adviser to the President on Energy, Mrs. Olu Verheijen, had last week met with senior executives of Nigeria’s electricity generation companies (GenCos) to review settlement modalities for the outstanding debt.
At the conclusion of the meeting, the parties reached a consensus which includes conducting bilateral negotiations to finalize full and final settlement agreements that balance fiscal realities with the financial constraints of the GenCos.
Having been approved by Tinubu and endorsed by the Federal Executive Council (FEC) in August 2025, the plan authorizes the issuance of up to N4 trillion in government-backed bonds to settle the arrears owed to the generation companies and gas suppliers.
Reacting to the development, Tony Elumelu, Chairman of Heirs Holdings and Transcorp Power, commended the President for the initiative.
Elumelu, as quoted in the statement, held that the government’s effort in tackling the root challenges of the power sector is first of its kind in many years.
“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,
“We commend President Tinubu and his economic team for this bold and transformative step.” He said.
On his part, Kola Adesina, Group Managing Director of Sahara Group, noted that the debt settlement will renew investors’ confidence in the reform process.
“This initiative is significant in every respect. It gives us renewed confidence in the reform process and a clear signal that the government is serious about building a sustainable power sector.” Adesina said.
In her remark, the Special Adviser to the President in Energy, Olu Verheijen, said the initiative’s focus was to create right condition for investment and build the confidence needed to attract large-scale private capital.
“Our focus is on creating the right conditions for investment, from modernizing the grid and improving distribution to scaling embedded generation,
“By closing metering gaps, aligning tariffs with efficient costs, improving subsidy targeting to support the poor and vulnerable, and restoring regulatory trust, we are shifting from crisis response to sustained delivery and building the confidence needed to attract large-scale private capital.” She said.
Similar, Wale Edun had maintained that the initiative and reforms transcended beyond liquidity but also seek to make Nigeria’s power sector work for investors, citizens, and next generation.
“These reforms go beyond liquidity,
“They are about rebuilding the fundamentals so that Nigeria’s power sector works for investors, for citizens, and for the next generation.
“This is how we create the enabling conditions for sustained private investment and transform reliable power into a catalyst for economic growth.” The Finance Minister had said