The Federal Government has disclosed ongoing plans to settle over N4 trillion owed to Power Generation Companies (GenCos) for electricity generated and supplied to the national grid.
Mr. Bola Tunji, Special Adviser on Strategic Communications and Media Relations to the Minister of Power, made this known in Abuja during an interview with the News Agency of Nigeria (NAN) on Tuesday.
Tunji was responding to a recent public appeal by the GenCos under the Association of Power Generation Companies (APGC), calling on the government and relevant stakeholders to urgently intervene and clear the debt backlog, which they say is crippling the sector.
“We expect a response from the Ministry of Finance very soon. We are not unaware of this debt arising from the Federal Government’s commitment on subsidy. Part of the debts are legacy debts, which were on the ground before the minister of power assumed office,” he added.
According to Tunji, the debt is a major obstacle to the smooth functioning of the power sector, and resolving it is a top priority for the ministry.
“The minister has repeatedly harped on this, knowing the implication of such debts to the operations of the various power sector stakeholders, especially the GenCos,” he said.
GenCos warn of looming Power Crisis
Earlier, the Association of Power Generation Companies (APGC) had raised the alarm over the deepening liquidity crisis in the Nigerian Electricity Supply Industry (NESI), warning that the continued accumulation of debt threatens the viability of the power plants.
In a statement signed by retired Col. Sani Bello, Chairman of APGC’s Board of Trustees, the GenCos disclosed they are owed N2 trillion for power supplied in 2024 alone, in addition to N1.9 trillion in legacy debt.
He added that, aside from being owed significant sums, the GenCos also face a tough operating environment marked by volatile exchange rates, high inflation, and poor access to finance.
“Besides being owed huge debts, the GenCos were also operating under very harsh monetary and fiscal conditions. It is no more news that the GenCos have continued to bear the brunt of the liquidity crisis in the Nigerian Electricity Supply Industry (NESI),” he stated.
Stakeholders in the power sector have repeatedly called on the Federal Government to implement financial stabilization measures to prevent further collapse of electricity generation and distribution in the country.
More insights
In March 2025, the Managing Director of the Niger Delta Power Holding Company (NDPHC), Jennifer Adighije called for urgent presidential intervention to secure funding for ongoing power projects and settle outstanding payments owed to Generation Companies (GenCos), as part of efforts to improve electricity supply across Nigeria.
Adighije highlighted the severe liquidity challenges facing the power sector, with over N4 trillion owed to GenCos, which has hindered their ability to operate efficiently.
