President Bola Tinubu has approved a N3.3 trillion payment plan to address outstanding debts in electricity sector and improve power supply reliability.
The allocation, announced on Tuesday, is intended to clear legacy liabilities owed to generation and gas companies, rather than funding new infrastructure projects.
The statement read, “President Bola Tinubu has approved the payment plan to finally settle the outstanding debts under the Presidential Power Sector Financial Reforms Programme.
“The debt repayment plan followed the final review of the legacy debts that have beset the power sector for more than a decade.
“The long-standing debts accumulated between February 2015 and March 2025. Following verification, ₦3.3 trillion has been agreed as a full and final settlement, ensuring a fair and transparent resolution.
“Implementation has begun, with 15 power plants signing settlement agreements totalling ₦2.3 trillion. The Federal Government has already raised ₦501 billion to fund these payments. Out of the amount, N223 billion has been disbursed, with further payments underway.
“What this means for Nigerians: With payments reaching the power value chain, generation will be more stable. With power plants supported, electricity reliability will improve.”
Commenting on the development, the Special Adviser on Energy to the President, Olu Arowolo-Verheijen, explained that the settlement would improve electricity reliability by stabilising the power value chain.
“This programme is not just about settling legacy debts. It is about restoring confidence across the power sector — ensuring gas suppliers are paid, power plants can keep running, and the system begins to work more reliably,” she said.
The adviser added that the reforms are part of broader initiatives, including better metering and service-based tariffs that link consumer payments to the quality of electricity received.
Priority will also be given to supplying electricity to businesses, industries, and small enterprises to support job creation and economic growth.
“The goal is simple: more reliable power for homes, stronger support for businesses, and a system that works better for all Nigerians,” Arowolo-Verheijen said.
“the electricity will only power poverty”
A detailed breakdown of the funds according to Charles Awuzie hows the bulk will go to foreign stakeholders. South Korea’s KEPCO holds about 70 percent stake in Egbin Power Plc, while UK-based Actis is the majority shareholder in Azura-Edo.
Lenders from the United States, the Netherlands and China are also set to receive significant portions, Awuzie claims.
Local beneficiaries include a small number of Nigerian firms such as Otedola’s Geregu and Elumelu’s Transcorp Energy, along with some government-linked entities.
The Analyst further criticised the distribution, noting that the payment primarily services past debts without stimulating local economic circulation. “Even if the foreign companies give you electricity, without the money circulating locally through local medium sized companies, the electricity will only power poverty and many Nigerians won’t be able to afford the electricity bills,” one observer remarked.
The statement added: “This is basic economics — give big projects to your people to enrich them. Use Law Enforcement to ensure they do the job.”
Nigeria currently has only about 8,100 dollar millionaires despite a population of roughly 230 million, compared with 41,000 in South Africa, which has 62 million people.
