ABUJA, Nigeria — The Federal Government will next week issue a second bond valued at N729 billion for the settlement of verified legacy debts owed to electricity generation companies (GenCos), as part of plans to complete the first phase of the N4 trillion Presidential Power Sector Debt Reduction Programme, the Nigerian Bulk Electricity Trading Plc has announced.
The proposed issuance will complete the first phase of the programme, following the successful issuance of approximately N501 billion in January 2026. Together, the two issuances constitute the N1.23 trillion Series 1 and 2 component of the Capital Market Multi-Instrument Issuance Programme.
The Chief Executive Officer of NBET, Johnson Akinnawo, said the bond represents the first phase of the broader N4 trillion programme approved by President Bola Tinubu to address legacy financial obligations in Nigeria’s electricity sector. The January 2026 issuance formed part of the Federal Government’s approach to settling verified obligations to GenCos, improving sector liquidity and strengthening the financial sustainability of the Nigerian Electricity Supply Industry.
Akinnawo described the forthcoming issuance as another significant milestone in the Federal Government’s efforts to restore liquidity, reinforce investor confidence and promote the long-term stability of the power sector. “The second issuance demonstrates the Federal Government’s commitment to resolving verified legacy obligations through a transparent, structured and market-based mechanism,” he said.
“By improving liquidity across the electricity value chain, the programme will help strengthen the financial position of market participants, support new investment and promote sustainable electricity generation for the benefit of Nigerians,” Akinnawo added.
The Federal Executive Council approved the establishment of the N4 trillion Presidential Power Sector Debt Reduction Programme in 2025, with NBET designated as the sponsoring institution for the settlement of verified legacy debts in the sector. The approved framework provides for the programme to be implemented through multiple issuances of debt instruments by NBET Finance Company Plc, a special-purpose vehicle established for the programme. The instruments are backed by the full faith and credit of the Federal Government and supported by a comprehensive package of risk-mitigation measures.
However, the Association of Power Generation Companies has rejected the process, insisting that the Federal Government excluded them from the design of the bond programme and forced terms on member firms. The APGC Chief Executive Officer, Dr Joy Ogaji, said GenCos were kept in the dark on the structure and that the government unilaterally audited invoices without the input of the Nigerian Electricity Regulatory Commission or the Nigerian Independent System Operator.
Ogaji stated that GenCos last reconciled with NBET in March 2025, when total legacy debt from 2015 to December 2024 was agreed at N4 trillion. The sector debt to GenCos has now risen above N6.8 trillion and continues to grow due to persistent market shortfalls, with a monthly payment shortfall of about N200 billion.
The Special Adviser to the President on Oil and Gas, Olu Verheijen, had earlier stated that the Federal Executive Council approved a bond programme of up to N4 trillion to settle verified generation and gas-company arrears, and that generation companies have signed full and final settlement agreements worth about N2.28 trillion. She described the fund as a strategic reset that clears verified arrears, restores liquidity, and gives operators the footing to invest with confidence.
Akinnawo added that the issuance of the N729 billion second bond would represent a decisive step towards resolving longstanding financial obligations and establishing a more stable, bankable and investment-friendly electricity market capable of supporting Nigeria’s economic growth.
