President Bola Ahmed Tinubu has approved the payment plan to finally settle the outstanding debts under the Presidential Power Sector Financial Reforms Programme.
This was disclosed by Bayo Onanuga, Special Adviser to the President on Information and Strategy in a statement on Sunday.
This is coming amidst the worsening power supply crisis with many parts of the country experiencing darkness.
The sector has been plagued by debts which the power generating companies (GenCOs) estimated at over N4 trillion.
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However, the presidential spokesman said the debt repayment plan followed the final review of the legacy debts that have beset the power sector for more than a decade.
He said the long-standing debts accumulated between February 2015 and March 2025. Following verification, N3.3 trillion has been agreed as a full and final settlement, ensuring a fair and transparent resolution.
"Implementation has begun, with 15 power plants signing settlement agreements totalling N2.3 trillion.
"The Federal Government has already raised N501 billion to fund these payments. Out of the amount, N223 billion has been disbursed, with further payments underway." He said.
The Presidency said what this means for Nigerians is that, with payments reaching the power value chain, "generation will be more stable. With power plants supported, electricity reliability will improve.
"And as the sector stabilises, more investment, more jobs, and better service will follow."
"This programme is not just about settling legacy debts. It is about restoring confidence across the power sector -- ensuring gas suppliers are paid, power plants can keep running, and the system begins to work more reliably", explained Olu Arowolo-Verheijen, Special Adviser on Energy to President Tinubu.
"It is part of a broader set of reforms already underway -- including better metering and service-based tariffs that link what you pay to the quality of electricity you receive.
"The government is also prioritising power supply to businesses, industries, and small enterprises -- because reliable electricity is critical to creating jobs, supporting livelihoods, and growing the economy.
"The goal is simple: more reliable power for homes, stronger support for businesses, and a system that works better for all Nigerians", she added.
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President Tinubu has commended all stakeholders who supported efforts to resolve the legacy issues in the power sector. He has also confirmed that the next phase (Series II) will begin this quarter.
