Tinubu Administration Approves N4 Trillion Bond Plan to Clear Crippling Power Debt Owed to GenCos

The Federal Government has taken a decisive step toward stabilizing Nigeria’s ailing electricity sector, announcing the finalization of a monumental plan to issue N4 trillion in government-backed bonds. This historic financial maneuver is specifically designed to settle all verified legacy debts owed to power generation companies (GenCos) and their gas suppliers, debts that have long crippled the industry.

Dependable NG reports that this strategic move represents the largest-scale debt resolution effort undertaken in the Nigerian power sector in more than a decade, following months of crisis that saw GenCos threatening a nationwide power sector shutdown back in April 2025 over the exact N4 trillion owed. The Special Adviser to the President on Energy, Mrs. Olu Verheijen, confirmed the finalization of the plan, stating that the bonds are an initiative approved by President Bola Tinubu and the Federal Executive Council (FEC). She emphasized that the action is a core part of the administration’s broader strategy to dismantle long-standing structural hurdles in the sector and cultivate an environment where significant private sector investment can thrive.

A high-level meeting involving the Minister of Finance and Coordinating Minister of the Economy, Wale Edun, and the Minister of Power, Chief Bayo Adelabu, solidified the agreement. The focus was on reviewing and completing the settlement framework, with key stakeholders agreeing to engage in bilateral negotiations. The goal of these negotiations is to forge comprehensive settlement agreements that are financially viable within Nigeria’s current fiscal capabilities while providing sustainable relief to the cash-strapped Generation Companies. According to the government’s statement, this intervention is a “major step… towards restoring financial stability and investor confidence within Nigeria’s electricity market.” By eliminating these crippling legacy debts, the Federal Government aims to significantly strengthen the financial health of utility companies and, crucially, enhance the overall reliability of power supply across the nation, aligning with President Tinubu’s vision of modernizing the country’s electricity infrastructure.