…As Gencos cry out over ₦4 trillion debt, risk of nationwide power shutdown
President Bola Tinubu has assured electricity generation companies (Gencos) of his administration’s commitment to resolving their longstanding debt claims, even as he appealed for more time to verify and validate the liabilities inherited from previous governments.
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The President made this known on Friday during a high-level meeting with members of the Association of Power Generation Companies, led by Col. Sani Bello (rtd), at the Presidential Villa in Abuja.
Addressing the Gencos, President Tinubu acknowledged the seriousness of the liquidity crisis facing the power sector and pledged transparency in addressing the debt overhang.
> “I accept the assets and liabilities of my predecessors, and there is no question about that. But that acceptance must be on credible grounds. I need to wear the audit cap of verifiability, authenticity…,” the President stated.
He emphasized that the government is working with audit and legal firms to scrutinize the claims and has already granted anticipatory approval for a ₦4 trillion bond programme to tackle the sector’s liquidity challenges.
The President’s Special Adviser on Energy, Mrs. Olu Verheijen, revealed that the federal government has so far validated ₦1.8 trillion of the ₦4 trillion claimed by Gencos. The debts, she said, span a 10-year period beginning in 2015 and stem from unfunded tariff shortfalls and market shortfalls.
“As of April 2025, we are carrying a verified exposure of ₦4 trillion. This figure may still be revised downward pending further validation,” she explained.
Mrs. Verheijen added that only fully verified claims will be included in the eventual bond issuance by the Debt Management Office (DMO), despite the anticipatory approval.
President Tinubu urged financial institutions not to rush into asset foreclosures against power firms, calling instead for patience and cooperation.
> “To our friends in the banking sector, I ask that we avoid foreclosures. Sharpen your pencils, but keep an eraser handy. Let’s persevere together,” he said.
The Minister of Power, Chief Adebayo Adelabu, warned of dire consequences if the financial crisis is not addressed quickly. He appealed for at least partial debt defrayment over a defined period, citing the risk of a nationwide shutdown of power generation assets.
However, he praised the President’s reforms in the sector, noting that they have restored investor confidence and yielded tangible results.
Among key achievements cited were:
Passage of the Electricity Act 2023, which decentralises the electricity market.
Launch of Nigeria’s first Integrated National Electricity Policy in 24 years.
$2 billion in new private capital inflows.
70% increase in sector revenue from ₦1 trillion in 2023 to ₦1.7 trillion in 2024.
A drop in government subsidy obligations by over ₦700 billion.
Peak generation of 5,801 MW and a record daily energy delivery of 120,370 MWh on March 4, 2025.
No national grid collapse so far in 2025.
Adelabu also highlighted progress in bridging the metering gap, noting that 300,000 smart meters have already been delivered under the ₦700 billion Presidential Metering Initiative and the World Bank-supported DISREP programme.
In separate remarks, business moguls Tony Elumelu and Kola Adesina echoed the Minister’s concerns, calling for urgent liquidity support and stable gas supply to avoid an energy crisis.
> “The Gencos are heavily indebted to banks. Foreclosure threats are real. We don’t need power to complete your transformation — we need power to enable it,” Elumelu told the President.
Adesina warned that power plants in the Afam axis are underperforming due to gas supply issues and proposed unlocking 800 million cubic feet of gas through NLNG to revive generation output.
The meeting was attended by top government officials including the Chief of Staff to the President, Femi Gbajabiamila; the Coordinating Minister of the Economy and Minister of Finance, Mr. Wale Edun; the Minister of Information and National Orientation, Alhaji Mohammed Idris; and other key players in the electricity sector.
By Bayo Onanuga
Special Adviser to the President on Information & Strategy
July 25, 2025
