The payment plan for the final tranche of the outstanding legacy debts owed to electricity generation companies under the Presidential Power Sector Financial Reforms Programme has been approved by President Bola Tinubu.
Electricity generation companies, also known as GENCos have always blamed the poor electricity supply situation in the country to the non-settlement of the outstanding debts, which accumulated between February 2015 and March 2025.
Following an extensive review and reconciliation of legacy debt records, the ₦3.3 trillion was agreed among all stakeholders as the full and final indebtedness approved for settlement.
A Presidency statement said the agreed amount was approved by the President to ensure a fair and transparent resolution of the protracted issue, which dragged on for more than a decade.
The statement said the implementation of the payment plan has already begun, with 15 power plants signing settlement agreements totalling about ₦2.3 trillion.
The Federal Government said it has already raised ₦501 billion from the issuance of bonds to fund a part of the payments, out of which about N223 billion has so far been disbursed.
With further payments expected to follow in the near future, the Presidency statement said the government was optimistic that payments reaching the power value chain would boost power generation and ensure more stability.
With power plants supported, electricity reliability will improve,” the statement said.
“As the sector stabilises, more investments, more jobs, and better service will follow,” the statement added.
The debt payment initiative,the statement said, was not just about settling legacy debts, but also about restoring confidence across the power sector.
“Ensuring gas suppliers are paid, power plants can keep running, and the system will begin to work more reliably,” the statement said.
Special Adviser on Energy to the President, Arowolo-Verheijen, said the legacy debt payment was part of a broader set of reforms already underway, including the provision of better metering and service-based tariffs that link what consumers pay to the quality of electricity they receive.
She said the government was also prioritising power supply to businesses, industries, and small enterprises, adding that because reliable electricity was critical to creating jobs, supporting livelihoods, and growing the economy.
The goal, she said, was simple: more reliable power for homes, stronger support for businesses, and a system that works better for all Nigerians.
While commending stakeholders for supporting the process to finally resolve the issue, President Tinubu confirmed that the next phase of the programme (Series II) would begin in the second quarter of this year.
