President Bola Tinubu has approved a ₦3.3 trillion payment plan to settle long-standing “legacy debts” in Nigeria’s power sector.
This move is part of the Presidential Power Sector Financial Reforms Programme and aims to stabilize the electricity value chain and improve power reliability nationwide.
The plan addresses legacy debts accumulated between February 2015 and March 2025 under the Presidential Power Sector Financial Reforms Programme.
Following a comprehensive review, the government agreed on ₦3.3 trillion as a full and final settlement, ensuring transparency and fairness.
A statement issued on Sunday by the special adviser to the president on information and strategy, Bayo Onanuga, stated that implementation of the repayment plan has already begun, with fifteen power plants already signed settlement agreements totalling ₦2.3 trillion.
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.
President Tinubu commended all stakeholders involved in resolving the legacy issues and confirmed that the next phase of the reforms, Series II, will commence this quarter.
