Game-Changer: Tinubu Sanctions ₦4 Trillion Electricity Debt Rewrite to End Power Outages
The Federal Government has approved a ₦4 trillion (about $2.6 billion) debt refinancing plan aimed at stabilizing Nigeria’s electricity sector and improving power supply nationwide.
The decision, announced in Abuja on Wednesday, covers debts accumulated between 2015 and 2023 owed to 27 power generation companies (GenCos). These unpaid obligations have been a major obstacle to investment in the sector, contributing to persistent power shortages across the country.
According to officials, President Bola Ahmed Tinubu gave the green light for the refinancing after an extensive audit and validation of the debt figures. The programme will be implemented within the next three to four weeks by the Debt Management Office (DMO), using instruments such as bond issuances to spread repayment costs over a manageable period.
Government sources revealed that the refinancing plan forms part of wider electricity market reforms, including a 35 percent reduction in subsidies and the introduction of higher tariffs for urban consumers. These measures are projected to save the government about ₦1.1 trillion ($718.6 million) annually.
Analysts believe the debt settlement will restore confidence among private investors, improve liquidity in the electricity market, and accelerate ongoing infrastructure upgrades in generation and transmission. Officials also expressed optimism that the intervention will help improve electricity supply reliability for households and businesses.
The move comes amid growing public pressure over chronic power shortages and rising operational costs in the energy sector.
