Nigeria: Tinubu Approves N3.3tn Plan to Clear Power Sector Debt

Nigeria's President, Bola Tinubu, has approved a comprehensive plan to settle outstanding debts under the Presidential Power Sector Financial Reforms Programme, aiming to resolve long-standing financial challenges that have plagued Nigeria’s electricity industry for over a decade.

The debts, accumulated between February 2015 and March 2025, were thoroughly reviewed and verified, with a total of N3.3 trillion agreed as a full and final settlement, Bayo Onanuga, Special Adviser to the President on Information and Strategy, said in a statement on Sunday.

The repayment plan is designed to ensure transparency and fairness across the sector.

According to the statement, implementation has already begun with 15 power plants signing settlement agreements totalling N2.3 trillion.

The Federal Government has mobilised ₦501 billion to fund the payments, of which N223 billion has been disbursed, with additional payments in progress.

Officials say the move is expected to stabilise the power generation value chain, improve electricity reliability, and attract more investment.

As the sector regains stability, Nigerians can anticipate enhanced service, increased jobs, and a more dependable power supply.

“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," explained Olu Arowolo-Verheijen, Special Adviser on Energy to President Tinubu.

“It is part of a broader set of reforms already underway, including better metering and service-based tariffs that link what you pay to the quality of electricity you receive.

“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.

“The goal is simple: more reliable power for homes, stronger support for businesses, and a system that works better for all Nigerians," she added.

Tinubu has commended stakeholders for their roles in addressing longstanding challenges in the power sector, acknowledging their support in advancing the debt resolution process.

He also confirmed that the next phase of the programme, known as Series II, is scheduled to commence later this quarter.