Friday July 25, 2025
By TheNewsDESK |
President Bola Tinubu met with the Association of Power Generation Companies (GENCOs) on Friday, July 25, at the Presidential Villa, assuring them of his administration’s commitment to resolving longstanding debts totaling ₦4 trillion, PM News reported.
The meeting, led by Col. Sani Bello (rtd), addressed liquidity challenges in Nigeria’s power sector.
Tinubu acknowledged inherited liabilities, stating, “I accept the assets and liabilities of my predecessors, and there is no question about that. But that acceptance must be on credible grounds. I need to wear the audit cap of verifiability, authenticity, and the fact that this inheritance is not a mere deodorant but a support structure for critical economic and industrial promotion.”
He urged patience, saying, “We are here. So market it to your other colleagues. Give us time to do verification and validation of the numbers.”
The President emphasized a market-driven electricity sector, noting, “This is a longstanding issue that is now being dealt with. I know how much we have been able to save on fuel subsidies. We introduced the alternative, CNG, to bring relief back to the people.”
To avoid bank foreclosures, he appealed, “To our friends in the banking sector, I ask that we avoid foreclosures. Sharpen your pencils, but keep an eraser handy. Let’s persevere together.”
He described electricity as “the most important discovery of humanity in the last 1,000 years,” critical for economic growth and human dignity.
Special Adviser on Energy, Mrs. Olu Verheijen, revealed a ₦4 trillion bond programme with anticipatory approval to tackle the liquidity crisis, caused by “a combination of unfunded tariff shortfalls and market shortfalls” over a decade.
She noted, “We have since sat with 27 GENCOs—not all of them are here today—and reviewed their PPAs and gas sales agreements to understand the legitimacy of their claims. The GENCOs claimed about ₦4 trillion from 2015 to the end of 2023.”
The Nigerian Bulk Electricity Trading Company (NBET) has validated ₦1.8 trillion, with ₦200 billion in unfunded subsidies adding to the liability. Verheijen clarified, “So, as of April 2025, the total exposure that we are carrying at the moment is ₦4 trillion,” pending final validation.
She added, “While there is an anticipatory approval of this ₦4 trillion bond programme, it is subject to negotiations and final settlement of agreements. Only the amounts that the federal government validly owes are the things that will make it into the issuance by DMO.”
Minister of Power, Chief Adebayo Adelabu, praised Tinubu’s leadership, stating, “Your Excellency, your presence at this meeting is a clear testament to your unwavering commitment to the sustainability, stability, and long-term development of Nigeria’s power sector. Under your leadership, we have recorded critical milestones in less than two years.”
He highlighted the Electricity Act 2023, which liberalized the market, and a new National Electricity Policy.
Adelabu noted a 70% revenue increase from ₦1 trillion in 2023 to ₦1.7 trillion in 2024, reducing subsidies by over ₦700 billion.
Installed capacity rose from 13,000 MW to 14,000 MW, with a peak generation of 5,801 MW and daily energy delivery of 120,370 MWh on March 4, 2025.
He added that no grid collapses occurred in 2025, and 300,000 smart meters were delivered under the ₦700 billion Presidential Metering Initiative.
However, he warned, “Mr. President, given the grave implications of this debt overhang, including the risk of a nationwide shutdown of generation assets, I humbly seek your immediate support for defraying these obligations, even if partially, over a defined period.”
Business leader Tony Elumelu urged urgent action, saying, “Mr. President, we’ve come to you as a last hope. The generating companies are heavily indebted to banks, and foreclosure threats are real, not because we’re not doing our jobs, but because the system owes us trillions.”
He praised Tinubu’s reforms, noting, “Before you took office in 2023, we lost 97% of our daily oil production. Today, we are retaining 98%. That’s transformation. Investors are seeing greater stability and predictability.”
On electricity, he added, “We don’t need power to complete your transformation, we need power to enable it. Power is critical to unlocking Nigeria’s full potential. We urge you to help solve this debt problem.”
Kola Adesina emphasized liquidity needs, stating, “Liquidity is the oxygen of our business. Without urgent intervention, generation capacity will stall, and Nigeria’s industrial and economic ambitions will be kindised.”
He proposed, “The plants in the Afam axis are underperforming because we have not paid gas suppliers. We propose unlocking 800 million cubic feet of gas through NLNG to boost supply to these power plants.”
The meeting included key officials like Chief of Staff Femi Gbajabiamila, Finance Minister Wale Edun, and Information Minister Mohammed Idris, alongside regulators and industry stakeholders, underscoring the government’s focus on resolving the power sector’s challenges.
