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, Mrs Olu Verheijen disclosed this in a statement issued in Abuja which was made available to newsmen on Friday by her media aide, Senan Murray.
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 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 continue with the remaining GenCos.
The special adviser said that the 7-year, fixed rate bonds would be guaranteed by the Federal Government of Nigeria.
According to her, speakers at the virtual meeting included the Ministers of Finance, Mr Olawale Edun, Power, Chief Adebayo Adelabu, and herself.
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
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 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.
“All of these measures are connected to the effort we are discussing today. Debt settlement provides the stability.
Financial reforms provide the structure. Operational reforms provide the reliability.
“Together, they create a path toward a sector that investors can trust and Nigerians can rely on,” she concluded.
For his part, 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.
“This is another milestone for the administration in trying to resolve the issues in the power sector – it is bold and transformative.”
He underscored the Federal Government’s commitment to “transparency, fiscal responsibility and disciplined financial management.”
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 2.2 trillion Naira in 2025.
“This has proven that with appropriate commercialisation and pricing of energy supply, there is bound to be improvement in market revenues.”
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.
The legacy debt is said to have constrained new investment, weakened utility balance sheets, and hindered reliable power delivery.
It has been described as the largest coordinated financial intervention in the history of Nigeria’s power sector.
