The Federal Government has paid about N333 billion to eight electricity generation companies in the country.
It has also launched a new N729 billion bond to clear more debts in the power sector.
This was disclosed on Tuesday at an investors’ forum organised by the Nigerian Bulk Electricity Trading, NBET, in Abuja.
The bond is part of the first phase of the Presidential Power Sector Debt Reduction Programme. Its goal is to settle verified debts and restore investor confidence.
Special Adviser to the President on Energy, Mrs. Olu Verheijen, explained that the move shows government’s commitment to honour its obligations.
According to her, under the first phase launched in February 2026, the government had already paid N501 billion which included N300 billion in cash and N201 billion in bonds to GenCos.
The N333 billion, she said, has already been paid to eight participating GenCos operating 17 power plants, while the first coupon payment of about N63.5 billion on the seven-year bond was paid in full on July 14, 2026.
She also said the payments had enabled participating generation companies to meet obligations to gas suppliers, lenders and operations and maintenance contractors, improving liquidity across the electricity value chain.
She added: “Markets do not reward promises; they reward performance. Capital follows credibility.The second bond issuance would further strengthen market liquidity and create the financial stability required to attract long-term private investment into the sector.”
She described the initiative as more than a debt settlement programme, saying it was designed to improve electricity reliability, support businesses and accelerate Nigeria’s economic transformation.
The Minister of Finance and Coordinating Minister of the Economy, Mr. Taiwo Oyedele, said the Federal Executive Council had approved a N4 trillion Power Sector Debt Reduction Initiative following a comprehensive verification of electricity market liabilities.
He disclosed that the verification exercise reduced outstanding claims from over N4 trillion to about N3.3 trillion after a detailed review of services rendered and amounts due.
He also that the second bond issuance, valued at about N729 billion, would complete the first phase of the programme by extending payments to additional generation companies, gas suppliers and other eligible service providers.
According to him, the successful payment of the first bond coupon reinforced the government’s credibility and strengthened investor confidence.
“Investors do not reward intentions; they reward execution. Every commitment honoured today reduces the cost of capital tomorrow,” the minister said.
The bond programme, he said, aligns with the Federal Government’s broader economic reforms aimed at strengthening public finances, expanding infrastructure financing and mobilising long-term private capital for strategic sectors.
Speaking, the Minister of Power, Chief Joseph Tegbe, described the liquidity challenge in the electricity market as one of the biggest obstacles to reliable power supply, adding that resolving it was critical to achieving sustainable growth in the sector.
Tegbe said the debt reduction programme represented a major reform aimed at restoring the commercial viability of Nigeria’s electricity market rather than merely settling outstanding obligations.
He implored pension funds, insurance companies, banks and other institutional investors to participate in the bond issuance, saying it’s as an opportunity to support the transformation of Africa’s largest electricity market.
He added: “Our destination is clear: a financially sustainable, investment-led electricity market that powers Nigeria’s industrial renaissance. Therefore, I encourage you to see this offering beyond a mere fixed-income instrument. It should be viewed as an opportunity to partner with the Federal Government in writing the next chapter of our economic story.”