Ajaokuta Steel Faces Possible Power Cut Over N5.46bn Debt
The Ajaokuta Steel Company Limited and its host community may face electricity disconnection over unpaid obligations totalling N5.46 billion, raising fresh concerns about the financial challenges surrounding Nigeria’s long-awaited steel complex.
The warning was contained in the Nigerian Electricity Regulatory Commission’s 2025 Annual Report, which revealed that the Ajaokuta complex failed to make payments towards energy invoices and service charges issued during the year.
According to the report, the steel company received an energy invoice of N4.96 billion from the Nigerian Bulk Electricity Trading Plc but made no payment.
A further N500 million service charge was issued by the Market Operator.
The combined unpaid obligations brought the total outstanding amount to N5.46 billion.
The development comes as the Federal Government continues to pursue efforts to revive the Ajaokuta Steel Complex, which has remained largely inactive despite decades of investment and policy interventions.
NERC Raises Concern Over Non-Payment
The Nigerian Electricity Regulatory Commission said the continued failure to settle the outstanding obligations had become a matter of concern.
According to the regulator, the issue has been escalated to relevant Federal Government ministries in search of a lasting solution.
NERC warned that the continued non-payment could expose the Ajaokuta complex to possible disconnection by its electricity service providers.
The commission said the complex could face consequences on the grounds of what it described as gross indebtedness.
The warning highlights the financial pressure that unpaid electricity bills can create within the Nigerian Electricity Supply Industry.
Electricity market participants depend on payments across the value chain to maintain operations.
When major customers fail to settle their obligations, the financial impact can extend to other operators within the sector.
N4.96bn Energy Bill Remains Unpaid
The largest portion of Ajaokuta’s outstanding obligation came from its energy invoice.
The Nigerian Bulk Electricity Trading Plc issued the complex an invoice of N4.96 billion for electricity received in 2025.
However, the commission said no payment was made towards the obligation.
The company also failed to pay the N500 million service charge issued by the Market Operator.
The failure to settle either obligation brought the total amount owed to N5.46 billion.
The situation has placed renewed attention on the financial position of the Ajaokuta Steel Complex.
The facility has long been viewed as a potentially important part of Nigeria’s industrial development ambitions.
However, efforts to fully revive operations have continued to face major financial, technical and administrative challenges.
Power Supply Is Critical to Industrial Revival
Reliable electricity is an essential requirement for large-scale industrial operations.
The steel industry, in particular, depends heavily on stable and consistent energy supply.
Any prolonged disruption in electricity could create further challenges for efforts to restore operations at the Ajaokuta complex.
The possibility of disconnection therefore raises important questions about the financial sustainability of the facility.
Ajaokuta’s revival plans will require more than investment in physical infrastructure.
They will also depend on the ability to meet operational obligations, including energy costs and other commercial commitments.
The latest electricity debt could become another major issue requiring government intervention as authorities seek to reposition the complex.
Federal Government Pushes Ajaokuta Revival
The disclosure comes amid renewed efforts by the Federal Government to revive the Ajaokuta Steel Complex.
For decades, the project has remained one of Nigeria’s most prominent examples of unrealised industrial ambition.
Successive governments have announced plans to restart the complex and attract investment into the steel sector.
The goal has been to develop a stronger domestic industrial base and reduce Nigeria’s dependence on imported steel products.
A fully functional Ajaokuta complex could potentially support manufacturing, construction and other sectors of the economy.
However, achieving that objective will require significant investment and an effective strategy for managing operational and financial obligations.
The N5.46 billion electricity debt demonstrates the scale of some of the challenges facing the facility.
Electricity Market Faces Pressure From Unpaid Bills
The issue also reflects a wider challenge within Nigeria’s electricity market.
Unpaid bills can weaken the financial position of companies responsible for generating, transmitting and managing electricity.
The Nigerian Bulk Electricity Trading Plc plays an important role in the electricity market as a bulk trader between electricity generation companies and distribution companies.
The Market Operator is responsible for the commercial administration of the electricity market.
When payments are delayed or completely absent, it can affect liquidity across the electricity value chain.
The financial health of the sector depends on customers and market participants meeting their obligations.
NERC’s warning signals increasing pressure on major consumers to improve payment performance.
International Customers Record Stronger Payment Performance
The NERC report also highlighted differences in payment performance among electricity customers.
International bilateral customers recorded lower remittance levels compared with local bilateral customers, although they still maintained relatively strong payment performance.
The three international customers received a combined invoice of $73.91 million for ancillary services.
They paid $62.75 million, representing a remittance performance of 84.9 per cent.
The international customers included electricity companies in Niger, Benin and Togo.
Local bilateral customers, however, recorded stronger payment performance.
They received invoices amounting to N13.20 billion and made payments totalling N12.75 billion.
This represented a remittance performance of 96.6 per cent.
The figures show that payment discipline remains an important factor in the sustainability of Nigeria’s electricity market.
Ajaokuta’s Debt Raises Fresh Questions
The possible electricity disconnection raises fresh concerns about the future of Ajaokuta.
The complex is expected to play a major role in Nigeria’s long-term industrialisation strategy.
However, the ability to revive large-scale industrial operations will depend on addressing outstanding financial obligations.
The Federal Government may also need to determine how the electricity debt will be resolved without creating additional pressure on the power sector.
For NERC, the issue is part of a wider effort to improve financial discipline in the electricity market.
The commission has warned that unpaid obligations cannot continue indefinitely without consequences.
The Challenge of Turning Ajaokuta Into an Industrial Hub
Nigeria’s ambition to revive Ajaokuta remains closely linked to its broader industrial development goals.
A successful steel industry could support local manufacturing and infrastructure development.
It could also create opportunities across mining, transportation, engineering and other sectors.
But the latest N5.46 billion electricity debt shows that reviving the complex will require a comprehensive approach.
Government will need to address infrastructure, financing and operational management at the same time.
The immediate concern is whether the outstanding electricity obligations will be settled before service providers take further action.
The longer-term question is whether Ajaokuta can be repositioned as a financially sustainable industrial operation.
For now, the threat of a power cut has added a new challenge to the long list of issues confronting the iconic steel complex.
As the Federal Government continues its push to bring Ajaokuta back to life, resolving the electricity debt may become an important test of the commitment to move the project from decades of expectation towards full industrial operation.
