The Federal Government of Nigeria has announced plans to address the over N4 trillion debt owed to Power Generation Companies (GenCos) for electricity supplied to the national grid. This disclosure was made by Mr Bola Tunji, Special Adviser on Strategic Communications and Media Relations to the Minister of Power, during an interview with the News Agency of Nigeria (NAN) in Abuja on Tuesday.
Tunji’s comments follow a renewed public appeal from the Association of Power Generation Companies (APGC), which urged the government and key stakeholders to urgently intervene and clear the debt backlog that is straining the electricity 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,” Tunji stated.
He described the outstanding payments as a significant challenge to the effective operation of the power sector and reaffirmed that resolving the debt crisis remains a central focus for the Ministry of Power.
“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 added.
The GenCos, operating under the APGC umbrella, had earlier raised alarms over the escalating liquidity crisis within the Nigerian Electricity Supply Industry (NESI). They warned that the mounting debt threatens the long-term sustainability of the country’s power infrastructure.
In a statement signed by retired Colonel Sani Bello, Chairman of the APGC Board of Trustees, the group revealed that N2 trillion is owed for power supplied in 2024 alone, in addition to N1.9 trillion in legacy arrears. The GenCos also noted that they are grappling with a difficult economic environment marked by unstable exchange rates, surging inflation, and limited access to financing.
“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),” Bello stated.
Amid growing concern within the sector, stakeholders have consistently urged the Federal Government to implement financial stabilisation policies to prevent a further breakdown in electricity generation and distribution.
In March 2025, the Managing Director of the Niger Delta Power Holding Company (NDPHC), Jennifer Adighije, echoed similar concerns, appealing for presidential intervention to secure funding for critical power projects and to settle payments owed to GenCos. She emphasised that the sector’s liquidity constraints—fuelled by the over N4 trillion debt—have severely impacted the ability of generation companies to maintain operations and deliver reliable electricity across the country.