By David Akinadewo-Adekahunsi
President Bola Ahmed Tinubu has approved a N3.3 trillion payment plan aimed at settling longstanding debts in Nigeria’s power sector, in a move expected to stabilise electricity generation and improve supply across the country.
The approval followed a final review of legacy debts accumulated under the Presidential Power Sector Financial Reforms Programme between February 2015 and March 2025.
After verification, the Federal Government agreed on N3.3 trillion as a full and final settlement of the obligations, signalling what officials described as a decisive step towards restoring confidence in the sector.
Implementation of the plan has already commenced, with 15 power generation companies signing settlement agreements valued at N2.3 trillion.
The government has so far raised N501 billion to fund the repayments, out of which N223 billion has been disbursed, while additional payments are ongoing.
The Presidency said the intervention would have direct implications for electricity supply, noting that improved liquidity within the power value chain would enable generation companies to operate more efficiently and sustain output, thereby enhancing reliability for consumers.
Special Adviser to the President on Energy, Olu Arowolo-Verheijen, said the initiative goes beyond debt settlement, describing it as a critical reform designed to reposition the sector for long-term stability.
She explained that ensuring prompt payments to gas suppliers and power producers would allow the system to function more effectively and attract fresh investment.
According to her, the programme forms part of broader reforms already being implemented, including improvements in metering and the introduction of service-based tariffs that align electricity pricing with quality of supply.
She added that the government is prioritising electricity supply to key sectors such as industries, businesses and small enterprises, stressing that reliable power remains essential for job creation, economic growth and improved livelihoods.
The Presidency noted that as the sector stabilises, the reforms are expected to unlock increased investment, create employment opportunities and deliver better service to electricity consumers nationwide.
Tinubu commended stakeholders across the power sector for their roles in resolving the legacy challenges and confirmed that the next phase of the programme, known as Series II, will commence within the current quarter as part of ongoing efforts to strengthen Nigeria’s electricity supply system.
