The federal government says it will raise N1.23 trillion within the next four months as part of a major push to settle longstanding debts owed to power generation companies (GenCos) and gas suppliers.
The special adviser to the president on energy, Olu Verheijen, disclosed this in a statement made available on Friday by her media aide, Senan Murray.
Ms Verheijen said the initiative forms a key component of the Presidential Power Sector Debt Reduction Programme and signals renewed commitment to stabilising Nigeria’s power sector.
According to her, the government announced the issuance of the bonds to mark a major milestone in President Bola Tinubu’s efforts to stabilise and reform Nigeria’s power industry.
She said the first phase of the issuance, expected to be completed by the first quarter of 2026, aims to raise N1.23 trillion to settle verified arrears owed to power generation companies (Gencos) and gas suppliers.
According to the special adviser, the bond issuance launch took place at a virtual investor forum jointly convened by the Federal Ministry of Finance, Federal Ministry of Power, and the Office of the Special Adviser to the President on Energy.
She also disclosed that several GenCos had signed final settlement agreements with the federal government in this regard, while negotiations with the remaining GenCos continue.
The special adviser said that the seven-year, fixed-rate bonds would be guaranteed by the federal government of Nigeria.
According to her, speakers at the virtual meeting included the Minister of Finance, Olawale Edun; the Minister of Power, Adebayo Adelabu; and herself.
Ms Verheijen said the meeting had over 600 participants drawn from banks, pension funds, insurance companies, issuing houses, asset managers, family offices, trustees, and other institutional investors.
In her remarks at the meeting, the special adviser traced the journey so far:
“Over the last several months, we have worked closely with the Ministry of Finance, Ministry of Power, NBET, NERC, and the Power Generating Companies (GenCos) to validate claims and negotiate settlement agreements.
“I am pleased to say that agreements covering 100 per cent of the Phase 1 issuance have been reached, and those remaining are making significant progress towards completion,” she said
Ms Verheijen added, “This is not a bailout; it is a strategic reset, one that clears verified arrears, restores liquidity, and gives power generation companies the footing they require to operate and invest with confidence.”
She acknowledged the need to ensure the future viability and sustainability of Nigeria’s power sector.
“Clearing the debt will create breathing room for operators to stabilise operations and plan new investments that will help deliver more power to Nigerians.
“Nonetheless, clearing old debts only matters if we prevent new ones from piling up behind them,” she said.
The special adviser also highlighted the broader market reforms being implemented by the Tinubu administration in this regard, targeted at cost-reflective tariffs, metering, service delivery, and ensuring commercial discipline.
Mr Edun thanked potential investors, describing their participation as “a display of your commitment to Nigeria’s development and the confidence you have in the Renewed Hope agenda and reforms of President Tinubu.”
He underscored the federal government’s commitment to “transparency, fiscal responsibility, and disciplined financial management.”
Mr Adelabu, in his remarks, outlined the ongoing success of the transition to cost-reflective tariffs, noting that DisCos’ collections have grown from N1 trillion in 2023 to N1.7 trillion in 2024 and an estimated N2.2 trillion in 2025.
“This has proven that with appropriate commercialisation and pricing of energy supply, there is bound to be improvement in market revenues,” he said.
The bonds are being issued on behalf of the federal government by the NBET Finance Company Plc, with CardinalStone Partners Limited as the Lead Financial Adviser and the Lead Issuing House.
Other parties include the Africa Finance Corporation (AFC) as Joint Financial Adviser and Afrinvest West Africa Limited as Bond Trustee.
For details on the Presidential Power Sector Debt Reduction Programme, interested investors are to visit
https://www.energyreforms.ng/power-sector-bond.
Approved by President Tinubu and endorsed by the Federal Executive Council (FEC) in August 2025, the Presidential Power Sector Debt Reduction Programme authorises the issuance of up to ₦4 trillion in government-backed bonds to address a legacy debt overhang.
(NAN)