The Federal Government has disclosed that it has paid about N333 billion to eight electricity generation companies (GenCos) as part of its ongoing power sector debt settlement programme aimed at improving liquidity in the Nigerian Electricity Supply Industry (NESI).
Government officials made the disclosure on Tuesday at an investors’ forum organised by the Nigerian Bulk Electricity Trading (NBET) Plc in Abuja.
At the event, the government also announced the launch of a second bond issuance worth N729 billion to clear additional legacy debts owed within the power sector and strengthen the financial stability of the electricity market.
According to officials, the new bond issuance forms part of the Presidential Power Sector Debt Reduction Programme, which is designed to address longstanding payment obligations to power generation companies and other market participants.
The payment of N333 billion to the eight GenCos is expected to improve cash flow within the electricity value chain and enhance the capacity of generation companies to sustain operations and invest in infrastructure.
Officials explained that the second bond would complete the first phase of the debt reduction programme, which is aimed at restoring confidence among investors, lenders and operators in the power sector.
The Federal Government noted that resolving legacy debts is critical to improving electricity supply, attracting private investment and ensuring the long-term sustainability of the Nigerian Electricity Supply Industry.
Stakeholders at the forum said the debt settlement initiative could help stabilise the power market, reduce financing pressures on generation companies and create a more bankable environment for future investments in Nigeria’s electricity sector.
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