The Federal Government has finalised implementation frameworks for a ₦4 trillion government-backed bond to settle verified arrears owed to power Generation Companies (GenCos) and gas suppliers.

Special Adviser to the President on Energy, Mrs. Olu Verheijen, disclosed this in Abuja through a statement signed by Senan Murray, Head of Media and Communications in her office.

According to Murray, the agreement was reached at a meeting between federal officials and senior executives of the GenCos to review modalities for settling outstanding debts. Attendees included the Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun; the Minister of Power, Chief Bayo Adelabu; and Verheijen.

“The meeting concluded with a consensus on the way forward, including bilateral negotiations to finalise full and final settlement agreements that balance fiscal realities with the financial constraints of the GenCos,” Murray said.
“This intervention—the largest in over a decade—addresses a legacy debt overhang that has limited investment, weakened utility balance sheets, and hindered reliable power delivery nationwide.”

He added that the initiative followed President Bola Tinubu’s approval of the Presidential Power Sector Debt Reduction Plan, endorsed by the Federal Executive Council, to remove structural bottlenecks and pave the way for private-sector-led growth.

Verheijen noted that the government’s focus is on modernising the national grid, improving distribution, scaling embedded generation, closing metering gaps, and aligning tariffs with efficient costs while protecting the poor through targeted subsidies.
“The sector is shifting from crisis response to sustained delivery and building confidence to attract large-scale private capital,” she said.

Finance Minister Wale Edun emphasised that the reforms go beyond liquidity relief. “This is about rebuilding the fundamentals so that Nigeria’s power sector works for investors, citizens, and future generations,” he said.

He added that complementary efforts to scale renewable energy, leverage domestic gas as a transition fuel, and build local capacity would position Nigeria for energy sovereignty and long-term growth.

Chairman of Heirs Holdings and Transcorp Power, Mr. Tony Elumelu, commended President Tinubu for his bold intervention, describing it as the most credible effort in years to address liquidity challenges in the power sector.
Similarly, Mr. Kola Adesina, Group Managing Director of Sahara Power Group, said the plan signalled renewed confidence and a strategic reset for Nigeria’s electricity market.

The Presidential Power Sector Debt Reduction Plan is being jointly implemented by the Ministries of Finance and Power, the Office of the Special Adviser on Energy, and the Nigerian Bulk Electricity Trading (NBET) Plc, in collaboration with key stakeholders.