President Bola Tinubu has approved a major payment plan aimed at clearing long-standing debts in Nigeria’s power sector, in a move expected to improve electricity supply and restore confidence across the industry.
According to a statement released on Sunday by the President’s Special Adviser on Information and Strategy, Bayo Onanuga, the decision followed a final review of legacy debts that have weighed heavily on the sector for over a decade.
The government confirmed that a total of ₦3.3 trillion has been agreed upon as full and final settlement for debts accumulated between February 2015 and March 2025. The move is intended to bring a transparent and lasting resolution to the financial challenges affecting power generation and supply.
Implementation of the plan is already underway. So far, 15 power plants have signed settlement agreements worth ₦2.3 trillion. The Federal Government has raised ₦501 billion to support the process, with ₦223 billion already paid out and additional disbursements ongoing.
Officials say the intervention will have a direct impact on electricity stability. With improved funding across the power value chain, generation is expected to become more consistent, while overall service delivery should improve for consumers.
The President’s Special Adviser on Energy, Olu Arowolo-Verheijen, described the initiative as more than just debt repayment. She explained that it is designed to rebuild trust in the sector by ensuring that key players—including gas suppliers and power generation companies—are properly paid, allowing operations to run more smoothly.
She added that the reforms are part of a broader strategy that includes improved metering systems and service-based tariffs, where electricity costs are more closely tied to the quality of supply received.
The government also highlighted its focus on prioritising power supply to businesses, industries, and small enterprises, noting that reliable electricity is essential for job creation and economic growth.
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President Tinubu commended stakeholders who contributed to resolving the sector’s long-standing issues and confirmed that the next phase of the programme will begin later this quarter.
The development comes against the backdrop of a deepening power crisis, with industry players previously warning that mounting debts—especially to gas suppliers—had led to reduced supply to power plants and worsening electricity shortages nationwide.
