The Federal Government has concluded arrangements to roll out the ₦4 trillion Presidential Power Sector Debt Reduction Plan, a major step aimed at resolving long-standing debts in Nigeria’s electricity industry and restoring stability to the power supply chain.
The initiative, approved by President Bola Tinubu, is designed to rejuvenate investor confidence, attract private capital, and set the power sector on a sustainable growth path.
In a statement issued by Senan Murray, Media and Communications Lead in the Office of the Special Adviser to the President on Energy, the agreement was reached on October 7, 2025, during a high-level meeting in Abuja. Participants included the Minister of Finance and Coordinating Minister of the Economy, Wale Edun; Minister of Power, Bayo Adelabu; Special Adviser to the President on Energy, Olu Verheijen; and executives from various electricity generation companies (GenCos).
The meeting resolved to advance bilateral discussions to finalize structured settlement deals that balance the government’s fiscal priorities with the operational needs of power producers.
Describing the debt plan as “a foundational reform,” Edun said the initiative would rebuild trust in the electricity market and promote private sector participation.
Endorsed by the Federal Executive Council (FEC) in August 2025, the framework allows the issuance of government-backed bonds worth up to ₦4 trillion to clear verified debts owed to power and gas suppliers. These legacy debts have for years constrained investment, limited capacity expansion, and weakened infrastructure performance across the value chain.
Industry stakeholders have welcomed the move as a turning point for Nigeria’s energy future. Tony Elumelu, Chairman of Heirs Holdings and Transcorp Power, described it as “a historic and decisive action that will unlock the nation’s power potential.”
Similarly, Kola Adesina, Group Managing Director of Sahara Group, lauded the initiative as “a clear demonstration of government’s resolve to deliver sustainable power reforms.”
Beyond debt clearance, the plan includes provisions for grid modernization, generation capacity expansion, metering improvements, and tariff reforms—with safeguards to protect low-income households while maintaining investor confidence.
The debt reduction effort is being coordinated by the Ministries of Finance and Power, in partnership with the Office of the Special Adviser to the President on Energy and the Nigerian Bulk Electricity Trading Plc (NBET).
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