President Bola Tinubu’s approval of a N3.3 trillion payment plan to settle long-standing debts in Nigeria’s electricity sector has been welcomed as a potentially important intervention in a market weighed down by years of unpaid obligations, poor liquidity and worsening supply instability. The Presidency said on April 6 that the repayment plan, under the Presidential Power Sector Financial Reforms Programme, covers legacy debts accumulated between February 2015 and March 2025 and is intended to restore confidence across the value chain. Special Adviser to the President on Energy, Olu Arowolo-Verheijen, said the programme is meant not only to clear arrears but also to help stabilise generation by ensuring gas suppliers and power plants are paid more reliably.
That is the government’s case. But the announcement has also exposed unresolved disagreements over the true scale of the debt and how the settlement figure was reached. The Association of Power Generation Companies has publicly questioned the N3.3 trillion figure, saying the last formal reconciliation it recognises was concluded in March 2025 and that a later tripartite engagement had resulted in a N4 trillion legacy debt figure being acknowledged. Joy Ogaji, chief executive of the association, said GenCos were not aware of any fresh verification exercise that reduced the amount to N3.3 trillion. That matters because the credibility of the payment plan depends not just on presidential approval, but on acceptance by the companies expected to benefit from it.
The larger financial pressure is also much deeper than the settlement headline suggests. Bloomberg reported in March that GenCos were owed about N6.8 trillion as of the end of February 2026, while industry voices have said only about N4 trillion of that represented legacy debt and the balance continued to grow because of ongoing market shortfalls. In other words, even if the government fully executes the N3.3 trillion plan, that alone may not solve the wider liquidity crisis unless current payment discipline improves.
