Tinubu to meet GenCos: FG vows to settle ₦4 trillion debt threatening Nigeria’s power grid – StartSmart Nigeria

Nigeria electricity debt crisis. Tinubu to Meet GenCos Over ₦4 Trillion Electricity Debt Crisis – FG Plans Immediate Payment

President Bola Ahmed Tinubu is expected to hold a crucial meeting with the leadership of Nigeria’s power-generating companies (GenCos) as part of urgent efforts to resolve a growing ₦4 trillion debt that poses a serious threat to the country’s electricity supply chain. Nigeria’s electricity debt crisis

According to StartSmart Nigeria, this development follows a high-level engagement on Tuesday, April 29, 2025, between the Minister of Power, Adebayo Adelabu, and the chairmen of several GenCos in Abuja. The emergency meeting was convened to address the increasing liquidity crisis in the power sector, which industry stakeholders fear could trigger a nationwide grid collapse.

The ₦4 trillion debt, which has accumulated over several years, is reportedly hampering power generation, making it difficult for GenCos to maintain operations and deliver consistent electricity to Nigerians.

Nigeria electricity debt crisis. Federal Government Moves to Avert Power Sector Collapse

In a press statement released on Sunday, May 4, 2025, by the minister’s Special Adviser on Strategic Communications and Media Relations, Bolaji Tunji, Adelabu disclosed that the Federal Government is taking decisive action. According to him, a plan has been laid out to pay a significant portion of the outstanding debt immediately.

The remaining balance, he added, would be addressed using structured financial instruments such as promissory notes to be issued over the next six months.

Nigeria electricity debt crisis. Tinubu–GenCos Meeting to Finalize Debt Strategy

The proposed meeting between President Tinubu and the GenCos leadership aims to finalize a clear roadmap for resolving the crisis. Adelabu stressed that the Tinubu-led administration is fully committed to preventing a total collapse of the electricity supply chain.

“There is a need to pay a substantial amount of the debt in cash,” Adelabu said. “At the minimum, let us pay a substantial amount, then ask for debt instruments in promissory notes to pay the rest.”

He emphasized the Federal Government’s understanding of the urgency, noting that “the government is committed to resolving this debt to stabilize the sector and prevent further crisis.”

Why This Matters: Implications for the Nigerian Power Sector

The ongoing electricity crisis has far-reaching implications for Nigeria’s economy. With businesses and households already grappling with erratic power supply and rising energy costs, the liquidity crunch in the sector threatens to worsen the situation.

Energy experts have warned that without immediate intervention, GenCos may be forced to shut down operations, further compounding Nigeria’s power woes.

Nigeria electricity debt crisis. FG’s Payment Plan: A Two-Phase Approach

The government’s approach to settling the ₦4 trillion debt is broken into two phases:

1. Immediate Cash Payment – A large portion of the debt will be paid directly to GenCos to allow for immediate relief and operational continuity.
2. Promissory Notes – The remaining amount will be paid using government-backed debt instruments within six months.

This method is aimed at maintaining GenCos’ confidence while balancing the Federal Government’s fiscal constraints.

What’s Next?

As Nigerians await the outcome of the Tinubu–GenCos meeting, many are hopeful that the Federal Government’s actions will lead to improved power generation and reliability. StartSmart Nigeria will continue to monitor and report on the developments surrounding this national energy emergency.