Federal Government has finalized implementation frameworks for a ₦4 trillion government-backed bond aimed at settling verified arrears owed to power Generation Companies (GenCos) and gas suppliers, marking a major intervention in Nigeria’s electricity sector.
The development was disclosed by Mrs. Olu Verheijen, Special Adviser to the President on Energy, in a statement issued Tuesday in Abuja. It follows a high-level meeting between federal officials and senior GenCos executives to review modalities for clearing the outstanding debts.
The meeting concluded with a consensus on next steps, including bilateral negotiations to finalize comprehensive settlement agreements. The government emphasized its commitment to balancing fiscal realities with the financial challenges facing GenCos.
The approved plan, which received Federal Executive Council (FEC) endorsement in August 2025, authorizes the issuance of up to ₦4 trillion in bonds.
It is described as the largest power sector intervention in over a decade, targeting a legacy debt overhang that has constrained investment, weakened utility balance sheets, and hindered reliable power delivery nationwide.
As of April 2025, the Federal Government’s verified debt exposure to GenCos—an accumulation dating back to 2015—stood at ₦4 trillion.
The bond initiative is expected to restore investor confidence, improve liquidity in the power sector, and enhance electricity supply across Nigeria.
