Nigeria’s electricity generation companies are now owed approximately N6.5 trillion by the federal government, according to Joy Ogaji, Chief Executive Officer of the Association of Power Generation Companies (APGC). Speaking on Arise TV, Ogaji disclosed that the debt, accumulated through the Nigerian Bulk Electricity Trader (NBET), has ballooned from N4 trillion as of December 2024 to its current level. GenCos issue monthly invoices of about N280 billion, but only around 35 percent is paid, leaving a recurring shortfall of roughly N200 billion each month that deepens the sector’s liquidity crisis.
The federal government announced plans in December to raise N1.23 trillion by the first quarter of 2026 to clear verified arrears and subsequently issued a N501 billion inaugural bond under the presidential power sector debt reduction programme. Ogaji described the bond as inadequate, warning that the debt continues to swell despite assurances from President Bola Tinubu to clear legacy liabilities. This mounting obligation represents one of the most significant fiscal drags on the power sector’s viability, directly impacting generation companies’ ability to procure gas, perform maintenance, and invest in capacity expansion.
The economic implications extend beyond generator balance sheets. Unpaid debts cascade through the value chain, leaving gas suppliers uncompensated and forcing plants to operate below capacity. This artificially constrains available megawatts, perpetuating load shedding and undermining the industrial productivity gains that reliable power would unlock. Each month of continued shortfall compounds the structural weakness at the heart of Nigeria’s energy economy.
