Legacy Debts: 15 Power Firms Sign Agreements For N2.3trn Settlement—FG

The federal government has secured settlement agreements from 15 power generation firms totaling N2.3 trillion under the Presidential Power Sector Financial Reforms Programme, marking a key step in resolving longstanding legacy debts crippling Nigeria’s electricity sector.

President Bola Tinubu approved the payment plan, presidential spokesman Bayo Onanuga announced.
The move follows an exhaustive, independent review of debts accumulated from February 2015 to March 2025, culminating in a final reconciled figure of N3.3 trillion.

Implementation is underway, with the government raising N501 billion so far—including N223 billion already disbursed—to fund the N2.3 trillion agreements signed by the 15 power plants.
This addresses chronic cashflow shortages that have disrupted power generation, gas supply, and distribution, stalling investments across the value chain.

What this means for Nigerians: Payments will stabilise generation, boost electricity reliability, reduce blackouts, and attract investment for jobs and better service.

Special adviser on Energy to President Tinubu, Olu Verheijen-Arowolo, emphasised the broader impact:
“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 run fully, and the grid works reliably.”

She linked it to ongoing reforms, including service-based tariffs that tie payments to electricity quality, expanded metering to end estimated billing, and prioritised supply for industries, SMEs, and households. Reliable power, she noted, drives job creation, livelihoods, and GDP growth.

President Tinubu commended stakeholders—power firms, regulators, and financiers—for their collaboration. He confirmed Series II reforms, focusing on renewables and private partnerships, will start this quarter amid Nigeria’s projected doubling of energy demand by 2030.