The Federal Government has set up a high-level committee to address the crippling debt owed to Power Generation Companies (GenCos), in a move aimed at stabilising Nigeria’s electricity supply industry and restoring investor confidence.
The Permanent Secretary, Ministry of Power, Mr Mahmuda Mamman, announced the development on Monday in Abuja during the 10th-anniversary celebration of the Association of Power Generation Companies of Nigeria (APGC).
Mamman, who was represented by a Director in the Ministry, Mrs Evangeline Babalola, said the committee’s mandate goes beyond debt repayment, extending to the creation of a sustainable payment structure that would prevent a recurrence of the liquidity crisis that has long plagued the Nigerian Electricity Supply Industry (NESI).
"In recognition of the critical importance of resolving this issue for the sustainability of our power sector, Mr President has constituted a committee specifically mandated to address the payment of outstanding debts owed to the GenCos," he said.
He commended the GenCos for their resilience and patriotism in keeping the national grid running despite the severe financial pressure.
"You have not abandoned your posts in spite of the severe liquidity challenges that would have forced closure in any other industry. This is not just business; this is patriotism in action," Mamman said.
According to him, President Bola Tinubu is fully aware of the liquidity challenges besetting the sector and is determined to implement measures that would bring lasting relief to power producers and consumers alike.
"As we work to resolve the debt situation, I encourage you to maintain the same spirit of resilience and commitment that has characterised your operations over the past decade," he said.
The event, themed "A Decade of Powering Progress, Driving Nigeria’s Energy Transformation," brought together key players in the power sector to review the decade-long journey since privatisation, one defined by ambition, investment, and persistent financial bottlenecks.
Earlier this year, GenCos had warned of a looming nationwide blackout due to an outstanding debt of about N4 trillion owed by the government.
In April, the Chairman of the APGC Board of Trustees, Colonel Sani Bello (rtd), disclosed that the companies were owed N2 trillion for power supplied in 2024 and another N1.9 trillion in legacy debts.
The GenCos lamented that they receive less than 30 per cent of their monthly invoices for electricity supplied to the national grid, a situation they say has made it nearly impossible to sustain operations.
"Despite significant investments and efforts to ramp up capacity, GenCos face systemic constraints, unfriendly policies, and mounting debts without a clear repayment plan. The absence of firm contracts and a securitised market has further complicated financial planning," the APGC said.
Industry experts had repeatedly warned that without urgent intervention, the mounting debts could cripple the entire power value chain, worsening Nigeria’s already fragile electricity supply.
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