The Nigerian government has finalised the implementation framework for the ₦4 trillion Presidential Power Sector Debt Reduction Plan, indicating a decisive step towards restoring financial stability and investors’ confidence in Nigeria’s electricity market.
Approved by President Bola Ahmed Tinubu and endorsed by the Federal Executive Council in August 2025, the plan represents one of the boldest fiscal interventions in over a decade, aimed at settling verified arrears owed to electricity generation companies (GenCos) and gas suppliers.
In a statement signed by Senan Murray of the Office of the Special Adviser to the President on Energy, the government said the initiative is expected to unlock long-delayed investments, strengthen the financial position of power utilities, and enhance the reliability of electricity supply across the country.
Murray disclosed that during a high-level meeting held in Abuja on October 7, 2025, the Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, the Minister of Power, Chief Bayo Adelabu, and the Special Adviser to the President on Energy, Mrs. Olu Verheijen, met with senior executives of the GenCos to review settlement modalities and agree on the framework for implementation.
The Minister of Finance and Coordinating Minister of the Economy, Mr Wale Edun, at the meeting said the reforms go beyond liquidity relief.
“They are about rebuilding the fundamentals so that Nigeria’s power sector works for investors, for citizens, and for the next generation.”
Special Adviser to the President on Energy, Mrs Olu Verheijen, said the focus of the government is on creating the right conditions for investment, from modernising the grid and scaling embedded generation to closing metering gaps and aligning tariffs with efficient costs.
She added that “We are moving from crisis management to sustained delivery and restoring regulatory trust to attract large-scale private capital.”
The session concluded with a consensus to initiate bilateral negotiations toward full and final settlement agreements that balance fiscal discipline with the financial needs of the operators.
Chairman of Heirs Holdings and Transcorp Power, Mr Tony Elumelu, commended President Tinubu and his economic team for the bold and transformative step.
He stated that the initiative represents a credible and systematic effort by the government to tackle the root liquidity challenges in the power sector.
Further speaking on the view, the Group Managing Director of Sahara Group, Mr Kola Adesina, said the framework is significant in every respect. He added that the move now gives renewed confidence in the reform process and a clear signal that the government is serious about building a sustainable power sector.
Under the plan, the government will issue bonds of up to ₦4 trillion to clear the legacy debts that have constrained power generation and dampened investor appetite.
Beyond settling arrears, the initiative marks a strategic reset for the entire electricity value chain, enabling fresh private investment, modernising grid infrastructure, and improving service delivery to households and industries.
The Presidential Power Sector Debt Reduction Plan is being jointly implemented by the Federal Ministry of Finance, the Federal Ministry of Power, and the Office of the Special Adviser to the President on Energy, in collaboration with the Nigerian Bulk Electricity Trading Plc and other sector stakeholders.
The framework also aligns with broader national efforts to scale renewable energy, leverage domestic gas as a transition fuel, and strengthen institutional capacity for long-term sustainability.