The Federal Government has raised N1.23 trillion through two bond issuances as part of efforts to address about N4 trillion in legacy debts owed to electricity generation companies (GenCos), in a move aimed at restoring liquidity and confidence in Nigeria’s troubled power sector.
The Chief Executive Officer of Nigerian Bulk Electricity Trading Plc (NBET), Akin Odeyemi, disclosed this in Abuja, stating that the government raised N501 billion through Series 1 in January and a further N728.9 billion under Series 2, launched in August. The second issuance attracted 11 GenCos, compared with eight participants in the first series, signalling stronger participation in the debt reduction programme.
According to Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, the Series 2 issuance comprises N402 billion in cash bonds and N326.9 billion in non-cash bonds allocated to participating GenCos. The initiative is designed to settle verified outstanding obligations that have weakened liquidity across the electricity value chain and limited the ability of power producers to invest in additional generation capacity.
Odeyemi said the debt settlement programme goes beyond clearing historical liabilities, as it is expected to improve financial stability across the Nigerian Electricity Supply Industry. However, Oyedele cautioned that clearing the debts alone would not solve the sector’s challenges, stressing the need for stronger market discipline, improved revenue collection, lower technical and commercial losses, and greater accountability among industry players.
The Federal Executive Council had earlier approved the N4 trillion Power Sector Debt Reduction Initiative following a verification exercise that reduced outstanding claims from more than N4 trillion to about N3.3 trillion. Under the first series, N333 billion has already been paid to eight GenCos covering 17 power plants, while a first coupon payment of about N63.5 billion on the seven-year bond was made in full on July 14, 2026. The government expects the latest issuance to deepen the debt settlement process and help create conditions for more stable electricity supply.
source: nairametrics
