The Federal Government has formally launched the bond issuance component of the Presidential Power Sector Debt Reduction Programme, marking a major step in President Bola Tinubu’s ongoing reforms to stabilise and revitalise Nigeria’s electricity market.
Under the first phase of the initiative, the government plans to issue up to ₦1.23 trillion in Federal Government-guaranteed, seven-year bonds by the first quarter of 2026. Proceeds will be used to clear verified arrears owed to power generation companies (GenCos) and gas suppliers—financial obligations that have long undermined liquidity and investment in the sector. Several GenCos have already signed final settlement agreements, with negotiations continuing for the rest.
The bond issuance was launched during a virtual investor forum convened jointly by the Ministry of Finance, Ministry of Power, and the Office of the Special Adviser to the President on Energy. The event drew over 600 institutional participants, including pension fund administrators, banks, insurers, asset managers, issuing houses, trustees, and other investors. Key speakers included the Minister of Finance, Mr. Wale Edun, the Minister of Power, Chief Adebayo Adelabu, and the Special Adviser to the President on Power, Olu Arowolo Verheijen.
Approved by President Tinubu and endorsed by the Federal Executive Council in August 2025, the Presidential Power Sector Debt Reduction Programme authorizes the government to issue up to ₦4 trillion in bonds, described as the largest coordinated financial intervention in Nigeria’s power sector history.
Special Adviser on Energy, Olu Verheijen, said the launch followed months of collaboration among the Ministry of Finance, Ministry of Power, NERC, NBET, and GenCos to verify claims and negotiate settlement terms. She confirmed that settlement agreements covering 100% of the first-phase issuance have already been finalized.
“This is not a bailout; it is a strategic reset,” Verheijen said. “It clears verified arrears, restores liquidity, and gives generation companies the stability needed to operate and invest with confidence.”
She added that while the clearance of legacy debt is critical, sustainability depends on ongoing reforms. “Debt settlement provides the stability. Financial reforms provide the structure. Operational reforms provide the reliability,” she said.
Finance Minister Wale Edun praised the strong turnout by investors, calling it “a demonstration of commitment to Nigeria’s development and confidence in President Tinubu’s Renewed Hope agenda.” He described the bond initiative as “bold and transformative,” reaffirming the government’s dedication to transparency and disciplined fiscal management.
Minister of Power Adebayo Adelabu highlighted signs of improving sector performance, noting that DisCos’ collections have risen from ₦1 trillion in 2023 to ₦1.7 trillion in 2024, with projections of ₦2.2 trillion for 2025. He said the trend reinforces the gains from the transition to cost-reflective tariffs.
The bonds are being issued on behalf of the government by NBET Finance Company Plc. CardinalStone Partners Limited serves as Lead Financial Adviser and Lead Issuing House, with the Africa Finance Corporation (AFC) acting as Joint Financial Adviser and Afrinvest West Africa Limited as Bond Trustee.
