Barely two weeks after the Federal Government said it was putting modalities in place to pay the N4 trillion debt owed electricity generation companies, a fresh revelation emerged yesterday that the indebtedness had increased to N6 trillion. The new development, which the operators described as unsavoury, is said to threaten power stability in the country.
Executive Director, the Association of Power Generation Companies (APGC), Dr. Joy Ogaji, warned of the dire consequences to power services and national growth of such an unsavoury development, stressing that the debt increased from N4 trillion at the end of 2024 to N6 trillion in 2025.
She spoke in Abuja yesterday during the 10th anniversary of the APGC. She said: “The sector still faces recurring challenges — liquidity shortfalls, gas shortages, inadequate grid infrastructure, and regulatory uncertainty.
These are not reasons for despair but for renewed resolve and strong political will.” About two weeks ago, the Federal Government said it had finalized implementation frameworks for a N4 trillion government-backed bonds to settle verified arrears owed to power Generation Companies (GenCos) and gas suppliers.
The Special Adviser to the President on Energy, Mrs. Olu Verheijen, said in a statement that the agreement was reached at a meeting between the Federal Government officials and senior executives of GenCos, to review settlement modalities for the outstanding debt. The meeting was attended by Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, the Minister of Power, Chief Bayo Adelabu, and Verheijen.
“The meeting concluded with a consensus on the way forward, which includes conducting bilateral negotiations to finalise full and final settlement agreements that balance fiscal realities with the financial constraints of the GenCos.
“This intervention — the largest in over a decade — addresses a legacy debt overhang that has constrained investment, weakened utility balance sheets, and hindered reliable power delivery across the country. “This is a major step by the federal government toward restoring financial stability and investor confidence in the electricity market,” she said.
The agreement followed a landmark initiative approved by President Bola Tinubu and the Federal Executive Council to address structural bottlenecks and lay the groundwork for large-scale private sector-led investment and sustained economic growth. Verheijen said that the Federal Government’s focus was on creating the right conditions for investment by modernising the grid, improving distribution and scaling embedded generation.
Minister of Power, Adebayo Adelabu, while speaking at the public presentation of the National Integrated Electricity Policy (NIEP) and Nigeria Integrated Resource Plan (NIRP) in Abuja on February 2025 had said that FG owed both the electricity generation companies (GenCos) and distribution companies (DisCos) over N4 trillion.
The minister had explained that the government’s is indebted to GenCos was to tune of over N2 trillion, while there is an outstanding unpaid subsidy for 2024 of N1.97 trillion. He added that additionally, the government owe the DisCos N450 billion for electricity subsidy in accrued in 2024.
The Chairman of the APGC Board, Col. Sani Bello (rtd) called on FG to urgently resolve the worsening liquidity crisis in the Nigerian Electricity Supply Industry (NESI), as a result of the claimed N6 trillion debt. He warned that the rising debts were severely constraining GenCos’ operations adding that the debt level had become unsustainable and was threatening the stability of the power sector.
