By Fatima Saka
President Bola Tinubu has approved a comprehensive payment plan to settle longstanding debts in Nigeria’s power sector, marking a major step toward improving electricity generation and supply across the country.
The initiative, under the Presidential Power Sector Financial Reforms Programme, follows a final review of legacy debts accumulated over a decade, from February 2015 to March 2025. After verification, the Federal Government agreed on ₦3.3 trillion as a full and final settlement to address the liabilities.
According to a statement issued by presidential spokesman Bayo Onanuga, implementation of the plan has already commenced. Fifteen power generation companies have signed settlement agreements worth ₦2.3 trillion.
The government has so far raised ₦501 billion to fund the payments, with ₦223 billion already disbursed. Further payments are currently underway as part of efforts to stabilise the sector.
Officials say the intervention is expected to significantly improve electricity generation and reliability. By settling debts owed across the power value chain, power plants will be better supported to operate efficiently, ultimately enhancing service delivery to consumers.
Speaking on the development, the President’s Special Adviser on Energy, Olu Arowolo-Verheijen, said the programme goes beyond debt repayment.
“This programme is not just about settling legacy debts. It is about restoring confidence across the power sector — ensuring gas suppliers are paid, power plants can keep running, and the system begins to work more reliably,” she said.
She added that the reform is part of broader efforts to reposition the sector, including improved metering systems and service-based tariffs that align electricity costs with quality of supply.
The government is also prioritising electricity supply to businesses, industries, and small enterprises to drive economic growth, job creation, and improved livelihoods.
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President Tinubu commended stakeholders for their roles in resolving the long-standing challenges and confirmed that the next phase of the programme, known as Series II, will commence within the current quarter.
The reform is expected to attract new investments into the sector, strengthen operational efficiency, and deliver more stable power to homes and businesses nationwide.
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