President Bola Tinubu has approved a sweeping ₦3.3 trillion payment plan aimed at resolving long-standing debts that have crippled Nigeria’s power sector, in a move expected to significantly improve electricity supply across the country.
The initiative, announced by the President’s Special Adviser on Information and Strategy, Bayo Onanuga, forms part of the Presidential Power Sector Financial Reforms Programme. It targets legacy debts accumulated between February 2015 and March 2025, which have hindered the efficiency and sustainability of the nation’s electricity value chain.
Following a comprehensive verification process, the Federal Government settled on ₦3.3 trillion as the full and final figure to be paid, a step officials say underscores a commitment to transparency, accountability, and fairness in addressing the sector’s financial challenges.
Implementation of the programme is already underway. Fifteen power generation companies have signed agreements covering ₦2.3 trillion, while the government has raised ₦501 billion to support the payments. Of this amount, ₦223 billion has already been disbursed, with additional tranches expected in the coming months.
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Speaking on the development, Special Adviser to the President on Energy, Olu Arowolo-Verheijen, described the initiative as a critical intervention designed to restore confidence across the power sector.
“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 noted that the debt clearance forms part of a broader reform agenda aimed at strengthening the sector’s long-term performance. These reforms include the rollout of improved metering systems and the implementation of service-based tariffs that align electricity costs with the quality of supply received by consumers.
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She further emphasized the government’s focus on powering economic growth by prioritising electricity supply to businesses, industries, and small enterprises.
“Reliable electricity is critical to creating jobs, supporting livelihoods, and growing the economy,” she stated, adding that the ultimate objective is to deliver “more reliable power for homes, stronger support for businesses, and a system that works better for all Nigerians.”
Industry stakeholders have long identified unpaid debts as a major bottleneck affecting power generation and distribution in Nigeria. By addressing these obligations, the government hopes to stabilise operations, attract fresh investments, and unlock improved service delivery across the sector.
President Tinubu also commended stakeholders for their cooperation in resolving what he described as decade-old challenges and confirmed that the next phase of the programme, known as Series II, will commence later this quarter.
The reform programme is widely seen as a pivotal step toward tackling Nigeria’s persistent electricity crisis and laying the foundation for a more reliable and efficient power supply system.
