The Federal Government is preparing to raise approximately ₦729 billion from the capital market to settle confirmed financial obligations owed to electricity generation companies in Nigeria.
The proposed transaction represents the second fundraising exercise under the Presidential Power Sector Debt Reduction Programme and follows a ₦501 billion issuance completed in January 2026.
Together, both instruments will provide about ₦1.23 trillion for the settlement of liabilities accumulated within the Nigerian electricity market.
An investors’ forum will be held on Tuesday, July 21, 2026, to present the structure of the new instrument to prospective participants and explain the repayment and risk-protection arrangements.
Government Meets First Bond Repayment
The first interest and principal payments attached to the January instrument became due on July 14 and were paid in full.
The timely payment could strengthen demand for the second issuance by demonstrating the government’s capacity to honour obligations created under the programme.
The Nigerian Bulk Electricity Trading Plc is coordinating the transaction through NBET Finance Company Plc, a special-purpose company established to issue the instruments.
The securities will carry the backing of the Federal Government, providing investors with sovereign credit support while allowing the outstanding electricity-market obligations to be converted into structured financial instruments.
Programme Targets ₦4 Trillion Power Debt
The planned ₦729 billion issuance forms part of a broader ₦4 trillion intervention approved to resolve historical debts in the electricity industry.
The initial ₦1.23 trillion raised through the first two transactions will complete the programme’s opening phase.
Nigeria’s power industry has struggled with a persistent revenue shortfall created by inadequate collections, electricity subsidies, transmission limitations and the inability of distribution companies to remit the full value of energy supplied.
These weaknesses have affected payments to generating companies, leaving several operators with limited cash to maintain equipment, purchase gas and invest in additional capacity.
Converting verified obligations into marketable debt instruments is expected to provide generation companies with greater certainty over payments while spreading the government’s financial burden across an agreed repayment period.
The arrangement could also improve the balance sheets of participating companies and allow them to meet obligations to lenders, gas suppliers and technical contractors.
However, settling existing debts will not eliminate the structural weaknesses responsible for the accumulation of new liabilities.
Sustainable improvement will require higher revenue collection, more accurate customer metering, cost-reflective pricing, improved transmission infrastructure and stronger payment discipline across the electricity value chain.
If successfully completed, the second issuance will represent an important step towards restoring confidence among generation companies and private investors. It will also test the capital market’s willingness to finance a larger portion of Nigeria’s ₦4 trillion power-sector debt resolution programme.
