Blackout looms as GenCos threaten shutdown over N4tn debt

The Power generation companies have threatened to shut down operations due to debts exceeding N4 trillion owed by the Nigeria Federal Government.

The Chairman of the GenCos’ Board of Trustees, Rtd. Colonel Sani Bello, made the disclosure in Abuja during a meeting on Monday April 14, 2025.

Bello said the debts include N2 trillion for power supplied in 2024 and N1.9 trillion in legacy liabilities.

He noted that the consistent non-payment has crippled operations and could lead to a total collapse of electricity generation.

“The power GenCos generated was fully consumed, yet they received only a fraction of their invoices,” he said.

He warned that the situation threatens the entire electricity value chain, from production to distribution across the country.

Bello criticised the 2025 national budget, which allocated N900 billion to the power sector, as grossly inadequate, inefficiency and imbalance.

He said regulatory agencies and service providers get paid in full, while GenCos receive only 9 to 11 percent.

“The payment structure violates the existing Power Purchase Agreement, leaving GenCos unable to meet operational and financial obligations,” he stated.

He noted that in 2024, collection rates dropped below 30 percent, worsening liquidity and destabilising power supply.

He said rising operational costs and limited access to foreign exchange make the situation even more unsustainable for GenCos.

Bello called for a specialised dollar allocation window to help GenCos meet foreign currency obligations for maintenance and purchases.

He urged the Federal Government to fully settle outstanding debts and restructure the current payment waterfall to prioritise GenCos.

He also asked for sovereign guarantees backed by institutions like the World Bank and African Development Bank.

“There must be a coordinated, urgent response to rescue the sector from collapse,” he said.

As of press time, the Minister of Power, Adebayo Adelabu, had not issued any official response to the matter.

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