The Federal Government has unveiled plans to raise a ₦729 billion power bond to settle outstanding debts owed to electricity generation companies, commonly known as GenCos, in a move aimed at strengthening Nigeria’s power sector and restoring confidence among investors. Government officials have begun consultations with financial institutions and prospective investors to discuss the proposed bond issuance, which is expected to provide liquidity to power generation companies struggling with unpaid obligations. Authorities believe the initiative will improve cash flow across the electricity value chain, enabling GenCos to sustain operations, invest in maintenance, and enhance electricity generation capacity. The accumulated debt has long been identified as one of the major challenges affecting the stability of Nigeria’s power industry, with generation companies repeatedly warning that delayed payments threaten the reliability of electricity supply. Officials explained that clearing the outstanding obligations would help improve market confidence, encourage further investment, and support ongoing reforms aimed at creating a more efficient and financially sustainable electricity sector. The proposed bond is also expected to strengthen relationships between the government, power producers, and financial stakeholders while addressing long-standing payment concerns that have slowed growth within the industry. Investors participating in discussions reportedly expressed interest in the initiative, while seeking clarity on the bond’s structure, repayment framework, and implementation strategy. Energy experts have welcomed efforts to resolve the debt burden, noting that financial stability remains essential for expanding generation capacity, improving power distribution, and delivering more reliable electricity to homes and businesses. If successfully implemented, the initiative could mark an important step toward improving Nigeria’s energy infrastructure, supporting economic growth, and creating a more sustainable and investment-friendly power sector.
