Tinubu unlocks N3.3trn to end decade- long debts in Power sector

President Bola Tinubu has decisively moved to revitalize Nigeria’s beleaguered power sector, approving a monumental ₦3.3 trillion payment plan to finally settle outstanding legacy debts that have plagued the industry for over a decade.

This landmark decision, announced on Sunday by the State House, marks a critical step towards ensuring reliable electricity supply, fostering investment, and stimulating economic growth across the nation.

The approved payment plan follows an exhaustive final review and verification of debts accumulated between February 2015 and March 2025.

The ₦3.3 trillion figure represents a
full and final settlement, designed to bring transparency and stability to a sector long hampered by financial uncertainty.

While implementation of the ambitious program has already commenced as to date, 15 power plants have signed settlement agreements totaling ₦2.3 trillion.

The Federal Government has successfully raised ₦501 billion to fund these initial payments, with ₦223 billion already disbursed and further payments actively underway.
This initial tranche is part of a broader
Presidential Power Sector Financial Reforms Programme, which has seen the issuance of a ₦501 billion bond to clear legacy debts and restore confidence.

Some reports had previously indicated that the government’s indebtedness to the power sector could reach ₦6.4 trillion by the end of 2025, making the verified ₦3.3 trillion settlement a significant and
negotiated resolution.

For millions of Nigerians, this initiative promises a tangible improvement in daily life. With payments reaching critical points in power value chain, generation is expected to become more stable, leading to enhanced electricity reliability.
The stabilization of the sector is anticipated to attract more investment, create new jobs, and ultimately lead to
better service delivery.

Olu Arowolo-Verheijen, Special Adviser on Energy to the President, underscored the profound impact of the program. “This programme is not just about settling legacy debts.

“It is about restoring confidence across the power sector — ensuring gas suppliers are paid, power plants can keep running, and the system begins to work more reliably,” she explained.

Arowolo-Verheijen further highlighted that this debt resolution is integral to a broader suite of reforms, including improved metering and implementation of service-based tariffs that directly link consumer payments to the quality of electricity received.
The government’s strategic focus also extends to empowering the economy. “The government is also prioritising power supply to businesses, industries, and small enterprises — because reliable electricity is critical to creating jobs, supporting livelihoods, and growing the economy,” Arowolo-Verheijen added.

The ultimate goal, she affirmed, is
straightforward: “more reliable power for homes, stronger support for businesses, and a system that works better for all Nigerians.”

Tinubu has extended his commendation to all stakeholders who contributed to
resolving these long-standing issues.

Looking ahead, the Statehouse confirmed that the next phase of the program, Series II, is slated to begin within the current quarter, signaling a sustained commitment to the power sector’s transformation.