The Federal Government has pledged immediate action to settle part of the ₦4 trillion owed to electricity generating companies (GenCos), aiming to prevent a complete collapse of Nigeria’s power infrastructure.
A statement issued on Sunday by Bolaji Tunji, Special Adviser on Strategic Communications and Media Relations to the Minister of Power, Adebayo Adelabu, revealed that this move follows critical discussions between the minister and GenCos’ chairmen in Abuja.
Adelabu assured stakeholders that the government will prioritise the prompt release of a substantial amount of the debt in cash. The balance will be paid through financial instruments, including promissory notes, with full clearance targeted within six months.
“There is need to pay a substantial amount of the debt in cash. At the minimum, let us pay a substantial amount, then ask for a debt instrument in promissory notes to pay the rest,” the minister stated.
Plans are underway for a meeting between President Bola Tinubu and GenCos leadership to fast-track the intervention and ensure long-term sustainability of the power sector.
Chairman of Mainstream Energy Solutions and leader of the Association of Power Generating Companies (APGC), Col. Sani Bello, warned that the sector is facing a national emergency. He cited the ₦4 trillion debt and severe liquidity shortages as existential threats to the power generation industry.
Kola Adesina, Chairman of Egbin Power and First Independent Power Limited, echoed these concerns, highlighting the power sector’s role as the backbone of national development. “Everything hinges on power—industries, homes, hospitals. We cannot afford to let the sector fail,” he said.
Dr. Joy Ogaji, CEO of APGC, listed critical challenges including erratic gas supply, foreign exchange instability, and persistent payment defaults. She pointed out the devastating effects of the naira’s depreciation from ₦157/$1 in 2013 to ₦1,600/$1, which has crippled maintenance and loan repayment capabilities.
Adelabu acknowledged the government’s part in the sector’s struggles and committed to regulatory reforms, payment resolutions, and public sensitisation. He also urged a shift towards cost-reflective tariffs, stressing that while the government will support the vulnerable, the economy cannot sustain blanket subsidies.
“Citizens must pay the appropriate price for the energy consumed. We’ll provide targeted support for the most vulnerable, but a fully liberalised power sector is essential for progress,” he stated.
The ministry also called on GenCos to lead nationwide education campaigns on electricity efficiency and tariff realities, while promising a full overhaul of operational frameworks to restore investor confidence and grid reliability.
