Categories: News

FG to raise N1.23trn in four months to clear power sector debts

The Federal Government plans to raise N1.23 trillion within four months to settle longstanding debts owed to power generation companies (Gencos) and gas suppliers.

Presidential Adviser on Energy, Olu Verheijen, announced the plan in Abuja on Friday, saying it marks the first phase of the Presidential Power Sector Debt Reduction Programme, approved by President Bola Tinubu.

The funds will be raised through a seven-year, government-guaranteed bond issuance, coordinated by the Ministries of Finance and Power, and NBET Finance Company Plc. Several Gencos have already signed settlement agreements with the government.

Verheijen described the initiative as a “strategic reset” aimed at restoring liquidity and encouraging new investments in the power sector. She said reforms on tariffs, metering and commercial discipline are being implemented to prevent fresh debt accumulation.

Finance Minister Wale Edun hailed the initiative as a transformative step in resolving power sector challenges, while Power Minister Adebayo Adelabu noted that DisCos’ collections have increased from N1 trillion in 2023 to an estimated N2.2 trillion in 2025.

The debt reduction programme authorises up to N4 trillion in bonds to clear legacy obligations that have hindered stable power supply and weakened utility finances.

LUKMAN ABDULMALIK

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