The Nigerian Bulk Electricity Trading Plc (NBET) has commenced payments to electricity generation companies (GenCos) and their associated gas suppliers under the Federal Government’s Presidential Power Sector Debt Reduction Programme, following the issuance of ₦728.979 billion Series 2 Bonds.
The settlement, which is part of the ₦4 trillion Power Sector Multi-Instrument Issuance Programme, comprises ₦402 billion in cash bonds and ₦326.979 billion in non-cash bonds, in line with the approved settlement framework.
NBET’s Managing Director and Chief Executive Officer, Akin Odeyemi, disclosed this in a statement, describing the development as a significant milestone in efforts to address longstanding financial obligations in the power sector.
He said the settlement was part of President Bola Tinubu’s efforts to resolve legacy debts, improve liquidity across the electricity value chain and strengthen the financial position of key industry participants.
According to NBET, the initiative is expected to improve the financial stability of generation companies and support the transition towards a more sustainable electricity market.
The company said addressing outstanding obligations would help restore confidence among market participants, improve payment discipline and provide greater commercial certainty for investors across the power sector.
It added that a financially stronger generation segment would enhance the capacity of GenCos to maintain and improve their power generation assets, potentially supporting increased electricity generation and improved reliability across the Nigerian electricity market.
The programme is being implemented under the Tinubu administration’s Renewed Hope Agenda, with the Federal Government seeking to resolve accumulated debts that have constrained the financial operations of participants in the electricity market.
NBET said the ongoing settlement was an important step towards establishing a more financially sustainable and commercially viable electricity market capable of attracting continued investment.
The company also disclosed that preparations were underway for the second phase of the debt reduction programme, as it continues to advance the objectives of the ₦4 trillion Power Sector Multi-Instrument Issuance Programme.
The programme is designed to address historical financial obligations and strengthen the financial framework underpinning Nigeria’s electricity market.