FG settles N333bn GenCos debt, pays first bond coupon

Nigeria's Federal Government announced it has fulfilled its commitments under the first tranche of its power sector debt financing program, settling N333 billion in legacy debts owed to electricity generation companies (GenCos). The government deployed approximately N501 billion, comprising N300 billion in cash and N201 billion through non-cash bond instruments, to settle these long-standing obligations for 17 power plants across eight participating GenCos.

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Every successful capital market tells the same story. Investors return where governments keep their promises. And today’s lecture is exactly about that. President Bola Tinubu’s administration has demonstrated, beyond doubt, its commitment to making a clean break from the fiscal dysfunction that once defined Nigeria’s power sector.

This move is intended to restore investor confidence in Nigeria's electricity market and establish a foundation for the upcoming launch of a N729 billion Series II bond. Olu Verheijen, Special Adviser to President Bola Tinubu on Energy, stated that the administration deliberately chose to demonstrate its credibility by honoring all investor obligations before seeking further capital. She highlighted that successful capital markets thrive where governments keep their promises, and President Tinubu's administration is making a decisive break from past fiscal dysfunction in the power sector.

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Through bold policy decisions and disciplined execution, we are converting an unsustainable liability into a bankable, well-governed investment opportunity that the market can trust.

Verheijen explained that the program converts unsustainable liabilities into bankable investment opportunities. The government is transforming yesterday's liabilities into today's liquidity and tomorrow's investment capacity, which, if sustained, will strengthen the entire electricity value chain, improve operational performance, and restore sector confidence. This initiative is part of the Presidential Power Sector Financial Reforms Programme under the Renewed Hope Agenda, prioritizing performance and execution over mere promises.

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We are converting yesterday’s liabilities into today’s liquidity and tomorrow’s investment capacity. That liquidity, if sustained, will strengthen the entire electricity value chain, improve operational performance, and restore confidence across the sector.