The Federal Government of Nigeria has successfully raised ₦501 billion through the inaugural issuance of a special power sector bond under the Presidential Power Sector Debt Reduction Programme (PPSDRP), achieving 100% subscription from a wide range of institutional investors including pension funds, commercial banks, asset managers, and other major market participants.
The bond, issued by NBET Finance Company Plc, comprises ₦300 billion raised in cash from the domestic capital market and ₦201 billion in bonds directly allotted to participating Generation Companies (GenCos). The overwhelming demand for the instrument signals strong investor confidence in the Tinubu administration’s power sector reform agenda and its commitment to resolving long standing financial challenges in the electricity industry.
The programme is designed to settle verified legacy payment arrears owed to power generation companies for electricity supplied to the national grid since February 2015. These accumulated debts widely estimated in the multi-trillion naira range have severely constrained liquidity, weakened the balance sheets of GenCos, limited gas supply arrangements, reduced available generation capacity, and discouraged new investment in the sector for well over a decade.
Minister of Finance and Coordinating Minister of the Economy, Wale Edun, who was represented by the Director General of the Debt Management Office (DMO), Patience Oniha, described the bond issuance as “far more than a financing transaction” calling it a critical turning point that demonstrates the government’s seriousness about contract enforcement, commercial viability, and long-term sustainability of the power sector.
Special Adviser to the President on Energy, Olu Verheijen, emphasized that the initiative represents “a decisive reset of the electricity market”, combining debt resolution with deeper financial and structural reforms aimed at creating a more predictable, investable, and commercially viable power sector.
Key Highlights of the Transaction

• Five GenCos have so far signed Final Settlement Agreements (FSAs) with the Nigerian Bulk Electricity Trading Plc (NBET), with a total negotiated settlement value of ₦827.16 billion. The companies are:
  • First Independent Power Limited (FIPL)
  • Geregu Power Plc
  • Ibom Power Company Limited
  • Mabon Limited
  • Niger Delta Power Holding Company Limited (NDPHC)
• These five entities represent 14 power plants.
• When fully implemented, the Presidential Power Sector Debt Reduction Programme is expected to impact 4,483.60 MWh/h of generation capacity.
• It will effectively finalize settlement for 290,644.84 GWh of electricity billed since February 2015.
• The programme will benefit companies that collectively serve over 12.03 million active registered electricity customers nationwide.
  Strong Institutional Backing & Execution
  The transaction was led by CardinalStone Partners Limited as Lead Financial Adviser and Lead Issuing House, working closely with NBET (as sponsor) and the Office of the Special Adviser on Energy, which spearheaded negotiations with the GenCos.
  The bond enjoys full Federal Government guarantee, Central Bank of Nigeria liquidity status, and compliance with Pension Commission (PenCom) requirements making it highly attractive to institutional investors.
  Acting Managing Director of NBET, Johnson Akinnawo, described the successful closure as “a major step forward in resolving the long-standing challenge that has constrained the power sector for years.”
  Experts believe the successful debut issuance will pave the way for subsequent tranches under the broader multi-instrument programme, helping to gradually unwind the crippling legacy debts and unlock fresh investments needed to improve generation, transmission, and ultimately deliver more reliable electricity supply to homes and businesses across Nigeria.
  The development is being widely viewed as one of the most significant and concrete moves yet by the current administration toward putting the Nigerian Electricity Supply Industry (NESI) on a firmer, more sustainable financial footing.