Nigeria’s GenCos Mark 10 Years of Privatisation Amid N4 Trillion Debt Crisis and Power Sector Challenges

Nigeria’s power generation companies (GenCos) yesterday commemorated a decade since the country’s electricity privatisation, even as the sector grapples with mounting debts and a stagnant power supply. The event, hosted in Abuja by the Association of Power Generation Companies (APGC), highlighted growing concerns over more than N4 trillion owed to GenCos by the Federal Government. Industry insiders warn that promises to clear the legacy debts remain largely unfulfilled, casting a shadow over the anniversary celebrations.

Despite assurances from government officials, no concrete plan has emerged to address the unpaid capacity and energy invoices. Sources told The Guardian that key ministries had failed to respond to repeated requests for clarification. Last week, the Federal Government, through the Special Adviser on Energy, claimed that arrangements were in place for debt settlement, but insiders insist no formal agreement has been reached. “The President had given assurances, but the finance minister, Wale Edun, and the special adviser on energy have been evasive,” one source said.

The sector’s financial strain is deepening. While GenCos are owed over N4 trillion, new arrears driven by low market remittances and tariff shortfalls have surged to N1.6 trillion as of August 2025, with projections hitting N2.2 trillion by year-end. Former Chairman of the Nigerian Electricity Regulatory Commission (NERC), Dr. Sam Amadi, described the liquidity shortfall as the “core weakness” of the privatisation exercise, highlighting the systemic challenges that continue to hinder sustainable electricity delivery.

At the APGC anniversary, industry leaders called for urgent action. APGC Board of Trustees Chairman Sani Bello urged regulators and government agencies to act decisively, while Senator Enyinnaya Abaribe, Chairman of the Senate Committee on Power, acknowledged the resilience of GenCos over the past decade but noted that unresolved structural and policy issues still undermine the sector’s progress.

Minister of Power, Adebayo Adelabu, confirmed that a presidential committee has been established to create a framework for clearing outstanding debts and preventing future accumulation. While this initiative offers a glimmer of hope, stakeholders emphasize that timely implementation will be critical to revitalizing Nigeria’s power sector and restoring investor confidence in the privatised electricity market.

source: The Guardian