Tinubu approves N3.3trn debt settlement to boost power supply

President Bola Ahmed Tinubu has approved a sweeping repayment framework to address long-standing financial obligations in Nigeria’s electricity sector under the Presidential Power Sector Financial Reforms Programme.

The approval comes after a comprehensive audit of legacy debts that have burdened the industry for over ten years.

The liabilities, incurred between February 2015 and March 2025, have now been confirmed, with ₦3.3 trillion set as the final settlement figure.

In a statement issued by presidential spokesperson Bayo Onanuga, implementation of the repayment strategy has already begun.

So far, 15 electricity generation firms have entered into settlement agreements totaling ₦2.3 trillion. The Federal Government has mobilised ₦501 billion to initiate the process, with ₦223 billion already paid out and further disbursements ongoing.

The initiative is expected to significantly enhance electricity supply nationwide. By settling debts across the power value chain, authorities say generation capacity will stabilise, resulting in more consistent power for households and businesses.

The move is also projected to unlock financial constraints within the sector, attract new investments, generate employment, and improve overall service delivery.

Commenting on the development, the Special Adviser to the President on Energy, Olu Arowolo-Verheijen, said the initiative goes beyond debt repayment.

“This programme is not just about settling legacy debts. It is about restoring confidence across the power sector ensuring gas suppliers are paid, power plants can keep running, and the system begins to work more reliably,” she said.

Arowolo-Verheijen added that the effort is part of wider reforms, including enhanced metering and the rollout of service-based tariffs tied to supply quality.

She noted that the government is prioritising electricity access for businesses, industries, and small enterprises to drive economic expansion and job creation.

“The goal is simple: more reliable power for homes, stronger support for businesses, and a system that works better for all Nigerians,” she added.

President Tinubu also praised stakeholders involved in resolving the sector’s longstanding challenges and confirmed that the next phase of the initiative, tagged Series II, will begin later this quarter.