The Federal Government has again promised to offset the N4 trillion debt owed the Power Generation Companies (GenCos) to avert an imminent collapse of the power infrastructure in the country.
Minister of Power, Chief Adebayo Adelabu made the pledge during a meeting with the Chairmen of the GenCos recently in Abuja, according to a statement on Sunday by his Special Adviser, Strategic Communications and Media Relations, Bolaji Tunji.
Recall that Adelabu while speaking last month at the Sixth Edition of the 2025 Ministerial Press Briefing held at the National Press Centre, Radio House, Abuja, announced that the sum of N2 trillion would be paid from the total amount by the end of this year.
This was following the threats by the GenCos to shutdown operations over the unpaid invoices. The debts were as a result of unfunded subsidies.
The Minister, during the recent meeting assured the GenCos executives that the government would prioritize immediate payment of a significant amount out of the N4 trillion debt while the balance would be defrayed through other debt instruments.
He said this would be proposed in a meeting being planned between President Bola Ahmed Tinubu and GenCos’ leadership.
“There is need to pay a substantial amount of the debt in cash. At the minimum, let us pay a substantial amount, then ask for debt instrument in promissory notes to pay the rest”.
He assured of the payment of the outstanding balance within six months through financial instruments such as promissory notes.
“We recognize the urgency of this matter. The government is committed to resolving this debt to stabilize the sector and prevent further crisis,” Adelabu stated, adding that President Bola Tinubu would meet with GenCos leadership to fast-track the process.
The GenCoS were led by Chairman of Mainstream Energy Solutions who is also the Chairman of Association of Power Generating Companies (APGA), Col. Sani Bello, who had earlier sounded the alarm over the sector’s dire state, citing the N4 trillion debt as a critical threat to operations.
He also warned that liquidity challenges had left GenCos unable to secure loans or maintain infrastructure.
“Without urgent intervention, the entire power ecosystem could collapse,” he stressed.
Kola Adesina, Chairman of Egbin Power and First Independent Power Limited, echoed the urgency: “This is a national emergency. Everything hinges on power—industries, homes, hospitals. We cannot afford to let the sector fail.”
Adelabu acknowledged the government’s role in the sector’s struggles, pledging to not only clear the debt but also implement reforms to ease operational bottlenecks.
He emphasized the need for full liberalization of the power sector, urging Nigerians to embrace cost-reflective tariffs.
“Citizens must pay the appropriate price for the energy consumed. The Federal Government will continue to provide targeted subsidy for economically- disadvantaged Nigerians. We have to understand that our economy cannot sustain subsidies indefinitely,” he asserted, calling for public sensitization campaigns to drive compliance.
Dr. Joy Ogaji, CEO of APGC Power, detailed systemic challenges undermining GenCos, including chronic payment defaults, erratic gas supply, and foreign exchange volatility.
She noted that the naira’s plunge from ₦157/$1 in 2013 to ₦1,600/$1 had devastated maintenance budgets and loan repayments.
“GenCos have borne unsustainable risks—from grid failures to unproductive taxes—while remaining patriotic,” she said.
The Minister outlined plans to transition the sector toward sustainability, including regulatory reviews to reduce levies and enhance market stability.
He also urged GenCos to collaborate on advocacy efforts to educate Nigerians on efficient electricity use and tariff realities.
