...To get all news updates, Join our WhatsApp Group (Click Here)
Connect with us on Linkedin (Click Here)
The Federal Government has paid a total of N1.23 trillion in outstanding debts owed to electricity generation companies (Gencos) as part of deliberate efforts to restore stability, liquidity and investors’ confidence in the nation’s power sector, with plans to settle the remaining balance in 2027.
The Minister of Power, Chief Joseph Olasunkanmi Tegbe, disclosed this on Tuesday while delivering a keynote address at the Harvard Business School Association of Nigeria (HBSAN) Energy Conference held in Lagos.
The high-level conference, which brought together key players, investors, policymakers and industry experts, focused on charting a sustainable path for Nigeria’s energy future and addressing the persistent financial and structural challenges confronting the electricity value chain.
Speaking on the theme of power sector financing and sustainability, Tegbe said the payment of N1.23 trillion represents a significant milestone in the Federal Government’s resolve to clear legacy debts that have for years constrained the operations of power generation companies and impeded reliable electricity supply to homes and businesses.
He explained that the President Bola Ahmed Tinubu administration inherited a huge debt overhang in the power sector, which had not only eroded the confidence of investors and lenders but also limited the capacity of Gencos to invest in maintenance, expansion and improved service delivery.
According to the Minister, the government is not only working assiduously to clear its outstanding obligations to power producers but has also put in place mechanisms to prevent the accumulation of fresh debts across the entire electricity value chain.
“Settling these legacy debts is critical to restoring investors’ confidence, improving liquidity in the market and ensuring that Nigerians enjoy improved electricity supply. Our goal is not just to pay off old debts, but to create a system where such debts do not recur,” Tegbe stated.
The Minister further disclosed that beyond the clearance of existing liabilities, the Federal Government is working on a comprehensive and sustainable financial framework that will ensure commercial viability, cost recovery and long-term stability in the sector.
He noted that such a framework would address issues of tariff shortfalls, subsidy management, revenue collection and efficient allocation of resources across generation, transmission and distribution segments.
Tegbe stressed that increasing electricity generation capacity and ensuring the optimal evacuation and utilization of available power remain central to the government’s strategy of strengthening the industry and driving inclusive economic growth.
“We are focused on increasing generation and ensuring that what is generated is effectively wheeled and distributed to end users. A stronger power sector means stronger businesses, more jobs and better living conditions for our people,” he said.
Reaffirming the administration’s commitment to the welfare of citizens, the Minister assured that ongoing reforms in the power sector are being implemented with a human face, with deliberate measures to protect vulnerable Nigerians from adverse impacts.
He said the government is working towards building a power system in which households, small businesses, industries and manufacturers can rely on a more stable, affordable and predictable electricity supply.
Tegbe added that the current efforts are fully aligned with President Bola Tinubu’s Renewed Hope Agenda, which prioritizes investment attraction, infrastructure modernization, economic prosperity and improved quality of life for all Nigerians.
“The Renewed Hope Agenda is about delivering results that matter to the people. Reliable electricity is at the heart of that promise. We are committed to providing power that supports productivity, competitiveness and prosperity,” the Minister noted.
He, however, acknowledged that while significant progress has been made, preventing fresh debts from accumulating will remain a major challenge that requires the cooperation of all stakeholders, including regulators, operators, consumers and development partners.
The Minister therefore called for greater discipline, transparency and accountability across the electricity market, urging all players to play their part in achieving lasting financial stability and operational efficiency in the sector.
Stakeholders at the conference commended the Federal Government’s bold steps in addressing the power debt crisis, describing the N1.23 trillion payment as a strong signal of government’s seriousness to fix the sector and attract fresh private investments.
With the target of full settlement by 2027, industry watchers believe the move could mark a turning point in Nigeria’s long quest for a viable and sustainable electricity market capable of powering its economic aspirations.
...To get all news updates, Join our WhatsApp Group (Click Here)
Connect with us on Linkedin (Click Here)
