President Bola Ahmed Tinubu is expected to meet with top executives of Nigeria’s power-generating companies in a high-stakes intervention aimed at resolving the alarming N4 trillion debt crisis threatening the nation’s electricity supply chain.
The meeting, now being urgently scheduled, follows a critical engagement on Tuesday between the Minister of Power, Adebayo Adelabu, and the chairmen of the Generation Companies (GenCos) in Abuja. The talks were prompted by growing concerns over an imminent collapse of the national grid, triggered by severe liquidity constraints and unpaid debts accumulating across the sector.
In a statement released on Sunday by the minister’s Special Adviser on Strategic Communications and Media Relations, Bolaji Tunji, the Federal Government expressed its readiness to clear a significant portion of the outstanding liabilities immediately. According to the minister, the balance would be settled over the next six months using structured financial instruments such as promissory notes.
“There is a need to pay a substantial amount of the debt in cash. At the minimum, let us pay a significant chunk, then use debt instruments in promissory notes to handle the rest,” Adelabu stated, stressing the urgency of the situation.
He described the crisis as a national emergency, warning that the government’s failure to act swiftly could result in a total breakdown of the power infrastructure. “We recognize the urgency of this matter. The government is committed to resolving this debt to stabilize the sector and prevent further crisis,” the minister said.
Leading the delegation of the GenCos was the Chairman of Mainstream Energy Solutions and current head of the Association of Power Generating Companies, Col. Sani Bello (retd), who sounded a stern warning about the fragile state of the industry. He disclosed that the GenCos were struggling to sustain operations due to the spiraling debts and chronic cash flow shortages that have plagued the sector.
The outstanding debt, now exceeding N4 trillion, includes approximately N2 trillion for power supplied so far in 2024 and an additional N1.9 trillion in legacy debts dating back several years. The GenCos had earlier issued a public warning to the Federal Government, urging immediate intervention to prevent systemic collapse.
This looming crisis comes at a time when Nigerians are already grappling with erratic power supply, high electricity tariffs, and broader economic challenges. Industry analysts have long warned that the sector’s financial health is unsustainable without urgent reforms and realistic cost-reflective pricing.
The planned meeting between President Tinubu and GenCo leaders is expected to set the tone for an emergency financial rescue plan that will not only address the current backlog but also ensure a sustainable payment framework going forward.
More developments are anticipated as the Presidency finalizes preparations for the crucial meeting.
