The Federal Government has unveiled plans to raise approximately N729 billion through a new bond issuance to settle verified legacy debts owed to electricity generation companies (GenCos), signaling a major step toward restoring financial stability in Nigeria’s struggling power sector. The move forms part of the Presidential Power Sector Debt Reduction Programme and is expected to improve liquidity across the electricity value chain while rebuilding investor confidence in the industry.
Ahead of the bond issuance, an Investors’ Forum is scheduled to hold on July 21, 2026, as authorities seek to engage stakeholders and strengthen market participation. The planned bond will serve as the second tranche under the programme and, when combined with the N501 billion bond issued earlier in January 2026, will bring the total value of the first phase to approximately N1.23 trillion. The initiative is part of a broader N4 trillion debt reduction strategy approved by President Bola Tinubu to address longstanding financial obligations in the power sector.
According to the Nigerian Bulk Electricity Trading Plc (NBET), the successful repayment of the first coupon and principal on the Series 1 bond, which matured on July 14, 2026, demonstrates the Federal Government’s commitment to honoring its obligations. Industry observers believe this prompt repayment sends a strong signal to investors and could encourage greater participation in future financing arrangements designed to support the electricity market.
NBET Chief Executive Officer, Johnson Akinnawo, described the forthcoming issuance as a significant milestone in efforts to revive the sector’s financial health. He noted that resolving verified legacy debts through a transparent and market-driven framework would strengthen the balance sheets of electricity market participants, encourage fresh investments, and ultimately contribute to more reliable power generation for millions of Nigerians who continue to grapple with electricity challenges.
For years, unpaid debts have remained one of the biggest obstacles limiting growth and investment in Nigeria’s electricity industry. With the government now pushing ahead with a structured financing solution backed by its full faith and credit, stakeholders are hopeful that the programme will create a more stable, bankable, and investor-friendly power market. If successfully implemented, the initiative could pave the way for improved electricity supply, stronger economic growth, and renewed confidence in one of Nigeria’s most critical sectors.
source: punch
