President Bola Ahmed Tinubu has given the green light to a N3.3 trillion plan to clear long-standing debts in Nigeria’s power sector, aiming to stabilize electricity supply and end the frequent outages caused by gas shortages and low generation.
The announcement comes as Nigerians continue to experience load shedding, with national power generation averaging just 4,300 megawatts between February and March 2026—far below the country’s installed capacity of over 13,000 megawatts and demand exceeding 20,000 megawatts.
In a statement by the President’s Special Adviser on Information and Strategy, Bayo Onanuga, the government confirmed that the N3.3 trillion settlement follows a thorough review of legacy obligations dating from February 2015 to March 2025. The amount is intended as a full and final settlement, ensuring transparency and fairness.
Implementation is already underway, with 15 power plants signing agreements totaling N2.3 trillion. The Federal Government had earlier raised N501 billion for the payments, with N223 billion already disbursed. The plan is part of the Presidential Power Sector Financial Reforms Programme, which also prioritizes better metering and service-based tariffs.
President Tinubu praised all stakeholders for supporting the resolution and confirmed that the next phase of payments, Series II, will begin this quarter. Olu Arowolo-Verheijen, the President’s Special Adviser on Energy, emphasized that clearing these debts will restore confidence across the power sector, ensure gas suppliers are paid, and help power plants operate efficiently.
“This is not just about settling debts,” she said. “It’s about creating reliable electricity for homes and businesses, supporting livelihoods, and boosting economic growth.”
Industry experts welcomed the move. Dr. Muda Yusuf, CEO of the Centre for the Promotion of Private Enterprise, described it as a “bold step” that could significantly improve electricity stability and investment in the economy.
However, questions remain. Dr. Joy Ogaji, CEO of the Association of Power Generation Companies, pointed out discrepancies over the final debt figure. She stated that while N4 trillion had been previously reconciled as owed to Generation Companies, only five GenCos have reportedly signed off on the N3.3 trillion settlement.
Despite these concerns, the government remains committed to restoring a more reliable electricity system and addressing the power sector’s long-standing challenges, which experts say could transform the nation’s energy landscape and economic productivity.
