President Tinubu moves to settle decade-long electricity debts, boost generation, and restore stability in Nigeria’s power sector
President Bola Ahmed Tinubu has approved a ₦3.3 trillion payment plan aimed at clearing longstanding debts in Nigeria’s power sector, in a move expected to improve electricity supply and restore investor confidence.
The debt, which accumulated over a period of about 10 years, is owed to power generation companies (GenCos) and gas suppliers. These liabilities have significantly affected the performance of the electricity value chain, limiting generation capacity and disrupting consistent power supply across the country.
According to government sources, the approved plan is already being implemented in phases. Agreements worth approximately ₦2.3 trillion have been reached with power generation companies, while about ₦501 billion has been raised so far to support the settlement process. Out of this, roughly ₦223 billion has already been disbursed.
The Federal Government says the intervention is designed to stabilise the sector by ensuring that power producers and gas suppliers receive payments owed to them, thereby enabling improved operations and increased electricity generation.
Officials also noted that the initiative forms part of broader reforms targeted at repositioning Nigeria’s power sector. These include improved metering systems, service-based tariff structures, and increased support for industrial and commercial electricity users.
If effectively implemented, the policy is expected to lead to more stable electricity supply, reduced outages, and enhanced efficiency in power distribution. However, experts caution that the impact may not be immediate, as structural challenges within the sector—particularly at the distribution level—still need to be addressed.
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