Bola Ahmed Tinubu has approved a ₦3.3 trillion payment plan to settle longstanding debts in Nigeria’s power sector, in a move aimed at stabilising electricity supply and restoring investor confidence.
The approval, announced on Sunday by presidential spokesman Bayo Onanuga, follows a comprehensive review of legacy debts accumulated under the Presidential Power Sector Financial Reforms Programme.
Onanuga said the debts, incurred between February 2015 and March 2025, were verified and agreed upon as a “full and final settlement” to ensure transparency and fairness in resolving the sector’s financial challenges.
He disclosed that implementation has commenced, with 15 power generation companies already signing settlement agreements worth ₦2.3 trillion. The Federal Government has so far raised ₦501 billion to fund the payments, out of which ₦223 billion has been disbursed, while further disbursements are ongoing.
According to the presidency, the intervention is expected to improve liquidity across the electricity value chain, leading to more stable power generation and enhanced reliability of supply to homes and businesses.
“With payments reaching the power value chain, generation will be more stable. With power plants supported, electricity reliability will improve,” Onanuga said, adding that increased investment, job creation and improved service delivery would follow as the sector stabilises.
Also speaking, the Special Adviser to the President on Energy, Olu Arowolo-Verheijen, said the programme goes beyond debt settlement to rebuilding confidence across the power sector.
“This programme is not just about settling legacy debts. It is about restoring confidence — ensuring gas suppliers are paid, power plants remain operational, and the system becomes more reliable,” she said.
Arowolo-Verheijen added that the reforms form part of a broader strategy that includes improved metering systems and service-based tariffs aimed at aligning electricity costs with quality of supply.
She noted that the government is also prioritising power supply to industries, businesses and small enterprises, stressing that reliable electricity is critical for job creation, economic growth and improved livelihoods.
“The goal is simple: more reliable power for homes, stronger support for businesses, and a system that works better for all Nigerians,” she said.
President Tinubu commended stakeholders in the power sector for their cooperation in resolving the long-standing issues and confirmed that the next phase of the programme, known as Series II, will commence later this quarter.
