The Federal Government has raised N728.979bn through its latest power sector bond issuance to settle verified debts owed to electricity generation companies and improve liquidity across the electricity market.
The Series 2 bond is part of the N4tn Power Sector Multi-Instrument Issuance Programme established to address outstanding obligations that have affected the financial stability of the power sector.
The latest issuance consists of N402bn in cash bonds raised from the capital market and N326.979bn in non-cash bonds allocated to participating generation companies under the Presidential Power Sector Debt Reduction Programme.
The transaction brings the total value of bonds issued under the first phase of the programme to about N1.23tn.
Speaking at the signing ceremony in Abuja on Monday, the Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, said the programme was aimed at resolving accumulated debts that had weakened liquidity and discouraged investment across the electricity value chain.
He, however, stressed that settling the existing obligations must be accompanied by reforms to prevent new debts from building up.
According to Oyedele, the government would focus on improving revenue collection, reducing technical and commercial losses, strengthening accountability and increasing efficiency across the power sector.
He said the effectiveness of the programme would ultimately depend on whether it helps create a financially viable electricity market capable of attracting investment and providing more reliable power to households and businesses.
The Chief Executive Officer of Nigerian Bulk Electricity Trading Plc, Akinola Odeyemi, said 11 generation companies were involved in the second phase, compared with eight under the first series.
He said the broader participation showed increased confidence in the debt reduction programme and its ability to provide a structured solution to verified outstanding obligations.
Odeyemi noted that unpaid debts had affected the ability of power market participants to meet their financial commitments and limited GenCos’ capacity to invest in additional generation.
The Special Adviser to the President on Energy, Olu Verheijen, said the first bond issuance had established the debt reduction model, while the second series was designed to expand its impact.
She said Series 1 resulted in settlement agreements with 11 generation companies covering 21 power plants.
The first issuance, completed in January, raised N501.021bn, comprising N300bn in cash bonds from the capital market and N201.021bn in non-cash bonds issued to participating GenCos.
The Federal Executive Council approved the N4tn programme in August 2025 to clear verified legacy obligations owed to power generation companies and gas suppliers.
The initiative is expected to strengthen liquidity, restore confidence among investors and create a more sustainable financial structure for Nigeria’s electricity market.
With the Series 1 and Series 2 issuances combined, the government has now mobilised approximately N1.23tn under the first phase of the programme.
