In a major step aimed at improving electricity supply across the country, President Bola Ahmed Tinubu has approved a ₦3.3 trillion payment plan to settle long-standing debts in Nigeria’s power sector.
The initiative is designed to address financial challenges that have weighed down the electricity industry for over a decade and to restore stability across the power value chain.
According to a statement issued on Sunday by the President’s Special Adviser on Information and Strategy, Bayo Onanuga, the settlement covers legacy debts accumulated between February 2015 and March 2025 under the Presidential Power Sector Financial Reforms Programme.
After a detailed verification process, the Federal Government approved ₦3.3 trillion as the full and final settlement of the debts, a move officials say will bring transparency and fairness to the system while allowing power generation companies to operate more efficiently.
Implementation of the payment plan has already begun. So far, fifteen power generation companies have signed settlement agreements valued at about ₦2.3 trillion.
To kick-start the process, the Federal Government has raised ₦501 billion, out of which ₦223 billion has already been disbursed, with additional payments expected in the coming phases.
Government officials believe the move will directly impact electricity generation and supply across the country.
“With payments reaching the power value chain, generation will be more stable. With power plants supported, electricity reliability will improve,” the statement noted.
Speaking further on the development, the Special Adviser to the President on Energy, Olu Verheijen, described the initiative as a critical step toward rebuilding confidence in the sector.
According to her, the settlement is not merely about paying off old debts but about ensuring that every link in the electricity supply chain — from gas suppliers to power plants — can function properly.
“This programme is not just about settling legacy debts,” she said. “It is about restoring confidence across the power sector, ensuring gas suppliers are paid, power plants can continue running, and the system begins to function more reliably.”
She added that the debt settlement forms part of broader reforms in the electricity sector, including improved metering systems and service-based tariffs that tie consumer payments to the quality of electricity received.
The government also plans to prioritize electricity supply to businesses, industries, and small enterprises in order to support economic growth and job creation.
“The goal is simple,” she explained. “More reliable power for homes, stronger support for businesses, and a system that works better for all Nigerians.”
President Tinubu also commended stakeholders in the power sector for their efforts in resolving the long-standing financial challenges and confirmed that the next phase of the reforms, known as Series II, will begin later this quarter.
For many Nigerians who have endured years of inconsistent electricity supply, the success of this initiative could mark a turning point toward a more stable and dependable power system.
