President Bola Tinubu has approved a ₦3.3 trillion repayment plan to settle long-standing debts in Nigeria’s power sector, a move aimed at improving electricity supply and rebuilding investor confidence.
The announcement was made by presidential spokesman Bayo Onanuga, who said the decision followed a comprehensive review of legacy debts accumulated over a decade, from February 2015 to March 2025. The government described the ₦3.3 trillion as a final, verified settlement intended to ensure transparency and fairness.
Implementation is already underway, with 15 power generation companies signing agreements worth ₦2.3 trillion. So far, ₦501 billion has been raised to fund the initiative, with ₦223 billion already disbursed and additional payments in progress.
According to the President’s Special Adviser on Energy, Olu Arowolo-Verheijen, the initiative is designed not only to clear debts but also to stabilise the sector. She noted that ensuring payments to gas suppliers and power producers would help keep plants operational and improve reliability across the system.
The repayment plan is part of broader reforms, including improved metering and service-based tariffs that align electricity costs with supply quality. The government is also prioritising power for businesses and industries to support economic growth and job creation.
Officials say clearing the debt backlog will improve liquidity across the electricity value chain, leading to more stable power generation and better service delivery. The next phase of the reform programme, known as Series II, is expected to begin within the current quarter.
Nigeria’s power sector has long struggled with grid failures, low generation capacity, and frequent outages. Reports indicate the country loses about $26 billion annually due to electricity shortages, while businesses spend an additional $22 billion on alternative power sources like generators.
