The assertion that payments under the Presidential Power Sector Financial Reforms Programme have not commenced is incorrect. The ₦501 billion Series I bond under Phase 1 of the programme, issued in January 2026, has already transitioned from issuance to active disbursement, in line with the programme’s phased implementation framework. Proceeds from the issuance are being disbursed through a combination of cash and structured instruments (notes).
The Phase 1 Series I issuance represents the first tranche of a broader ₦4 trillion Presidential Power Sector Financial Reforms Programme, designed to resolve accumulated arrears and reposition the sector on a more sustainable financial footing.
Given that the funds are being sourced from the capital market, the size of each Series will be based on the absorptive capacity of the market. As with any structured, multi-party financial programme of this scale, disbursements are being implemented in phases, subject to standard documentation, reconciliation, and completion processes. Accordingly, timelines will vary across participants, and it is not accurate to generalise the status of the entire sector based on individual cases.
Incorrect claims have also been made about the verified size of the debt burden being addressed under the programme. A comprehensive Government-led audit and verification exercise has determined the outstanding amount owed to Power Generation Companies (“GenCos”) by Nigerian Bulk Electricity Trading Plc (NBET) between February 2015 and March 2025 – the settlement period – to be approximately ₦4.55 trillion.
The Phase 1 Series I bond offer opened on 19th December 2025 and closed on 8th January 2026, with a total of ₦501.021 billion successfully issued, representing approximately 41% of the target for Phase 1. The issuance was oversubscribed, with participation from domestic institutional investors, reflecting strong investor confidence which underscores the depth and credibility of the Programme. The instrument is supported by robust credit features and enhancements, including a Federal Government of Nigeria Guarantee, eligibility under pension investment guidelines, and dual listing on both the Nigerian Exchange (NGX) and FMDQ, to enhance liquidity and secondary market trading.
Fifteen (15) power generation plants have so far executed settlement agreements valued at about ₦870 billion. This amount reflects a haircut agreed with the GenCos. Of this amount, ₦319.75 billion has been earmarked for direct payment to gas suppliers, covering verified outstanding obligations for the period from February 2015 to March 2025, while the balance of ₦551 billion will be used to settle the GenCos.
Of the fifteen (15) power generation plants to be settled under the current (initial) phase, approximately 50% of their total agreed settlement amount will be paid from Series 1 proceeds. Additional balances due to all GenCos who have signed up to the Programme at the time of issuance will be settled under Series 2 of the programme, which is scheduled to commence in Q2-2026.
Gas suppliers are also included in the programme – as part of the Federal Government’s debt settlement programme, a portion of the financing proceeds will be applied directly to the settlement of outstanding obligations to gas suppliers. Payment is structured in a manner that ensures liquidity is injected into the entire power sector value chain using an escrow mechanism. As such, all payments are initially made into a designated escrow account created for each GenCo that agrees to participate in the programme. Thereafter, payment is only released from the escrow account to the GenCo and its relevant creditors such as gas suppliers or contractors subject to the fulfilment of the relevant Conditions Precedent, as contained in the settlement agreement.
To date, payments have been made to the following GenCos and Gas suppliers (“GasCos”) that have met the required conditions and settlement documentation:
a. Mabon Energy Limited, which owns Dadin Kowa hydropower plant – approximately ₦7 billion in cash and notes payment.
b. First Independent Power Limited (FIPL), which owns Omoku IPP, Rivers IPP and Trans-Amadi IPP – approximately ₦11 billion.
c. Accugas Limited, gas supplier for Ibom Power Company – approximately ₦6.87 billion
All GenCos that executed the Settlement Agreements as of a stipulated deadline of January 8, 2026 have been provisionally allotted bonds, subject to the fulfillment of all required conditions. The process is ongoing to address GenCos that executed Settlement Agreements after the deadline, and disbursements will continue progressively as additional participants meet the required conditions, ensuring a disciplined, transparent, and impact-driven implementation.
Additional phases of the programme will be determined based on the verified settlement amounts agreed with GenCos that are yet to execute their agreements, ensuring that all outstanding obligations are addressed in an orderly and transparent manner. The phased approach is intentional and reflects a disciplined execution strategy, not a delay, ensuring efficient capital mobilisation while maintaining stability in the domestic debt markets.
Overall, the Presidential Power Sector Financial Reforms Programme represents a significant and positive step forward for the Nigerian power sector, and early progress indicates that the programme is functioning as intended.
The Presidential Power Sector Financial Reforms Programme exists within a framework of broader market reforms being implemented by the President Bola Ahmed Tinubu administration in Nigeria’s power sector, targeted at cost-reflective tariffs, comprehensive metering, service delivery, and ensuring commercial discipline.
For more information on the Presidential Power Sector Financial Reforms Programme, visit: https://www.energyreforms.ng/power-sector-bond