FG’s N501bn power sector bond records full subscription

The Federal Government has announced that its N501 billion inaugural tranche under the Presidential Power Sector Debt Reduction Programme has recorded 100 per cent subscription from investors.

The development was disclosed in a statement issued on Tuesday by the Special Adviser to the President on Energy, Olu Verheijen.

According to the statement, the bond issuance, which forms part of efforts to address longstanding debts in the power sector, attracted participation from pension funds, banks, asset managers and other investors.

The government said the programme is aimed at resolving legacy payment arrears owed to power generation companies, restoring liquidity and strengthening confidence in the Nigerian Electricity Supply Industry.

Speaking at the bond issuance signing ceremony in Lagos on 27 January 2026, Verheijen said the initiative represents a major reset of the electricity market.

“The Programme represents a decisive reset of the electricity market, combining debt resolution with broader financial and structural reforms,” she said.

The statement explained that the Series 1 Power Sector Bond Issuance, executed by NBET Finance Company Plc, closed at ₦501 billion, comprising ₦300 billion raised from the capital market and ₦201 billion allotted to participating power generation companies.

Under the programme, verified receivables for electricity supplied between February 2015 and March 2025 are being settled through negotiated agreements with power generation companies.

It stated that five generation companies — First Independent Power Limited, Geregu Power Plc, Ibom Power Company Limited, Mabon Limited and Niger Delta Power Holding Company Limited — have so far executed Settlement Agreements with the Nigerian Bulk Electricity Trading Plc.

The total negotiated settlement amount for the companies stands at ₦827.16 billion, to be paid in four phased instalments.

The government said proceeds from the Series 1 issuance would fund the first and second instalment payments estimated at ₦421.42 billion, representing about 50 per cent of the total settlement amount.

Reacting to the development, the Group Managing Director of Sahara Power Group, Kola Adesina, said the move would restore investor confidence in the sector.

“Capital formation can only come when there is confidence, when you can truly see a line of sight in recovering investments previously made,” Adesina said.

“Because we were being owed so much, it was a bit of a problem for us to put in more money. But last year we took the bull by the horns, based on President Bola Ahmed Tinubu’s commitment in resolving the legacy issues,” he added.

Adesina further said, “Once this process is over, construction will commence immediately on the second phase of our Egbin Power Plant. On behalf of the Generation Companies, I’d like to thank the President for this resolution.”

The statement noted that by clearing historic arrears, the programme is expected to improve liquidity for power generation companies, unlock new investments and support a more reliable electricity supply nationwide.

Verheijen reaffirmed the Federal Government’s commitment to the programme, saying, “The Federal Government reaffirms its commitment to disciplined implementation of the Programme, and we look forward to the participation of other power generation companies, as part of our broader reforms aimed at building a financially sustainable electricity market that is capable of supporting Nigeria’s long-term economic growth.”