Bola Ahmed Tinubu has approved a ₦3.3 trillion payment plan to settle long-standing debts in Nigeria’s power sector, in a move aimed at improving electricity supply and restoring investor confidence.
The development was disclosed in a statement by presidential spokesperson Bayo Onanuga, who explained that the decision followed a review of legacy debts accumulated between February 2015 and March 2025 under the Presidential Power Sector Financial Reforms Programme. “Following verification, ₦3.3 trillion has been agreed as a full and final settlement, ensuring a fair and transparent resolution,” the statement noted.
According to the government, implementation has already begun. Fifteen power generation companies have signed settlement agreements valued at ₦2.3 trillion, while ₦501 billion has been raised so far, with ₦223 billion already disbursed.
The Special Adviser on Energy to the President, Olu Arowolo-Verheijen, said the initiative is designed to stabilise the entire power value chain. “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 function more reliably,” she said.
She added that the plan is part of broader reforms, including improved metering systems and service-based tariffs. “It is part of a wider reform effort already underway, including better metering and tariffs that align payment with the quality of electricity supplied,” she explained.
The government also stated that priority would be given to businesses and industries, highlighting the importance of reliable power for economic growth and job creation. “The goal is simple: more reliable electricity for homes, stronger support for businesses, and a system that works better for all Nigerians,” Arowolo-Verheijen added.
Officials say clearing the debt backlog will boost liquidity in the sector, leading to more stable electricity generation and improved service delivery. The presidency also confirmed that the next phase of the programme, known as Series II, is expected to commence within the current quarter.
Nigeria’s power sector has long faced challenges including low generation capacity, frequent grid failures, and widespread outages. A 2024 report by Standard Bank estimated that the country loses about $26 billion annually due to electricity shortages, with businesses spending an additional $22 billion on alternative power sources such as generators.
