Power Generation Companies Seek Clarification from President Tinubu Over N3.3 Trillion Electricity Sector Debt
Power Generation Companies (GenCos) in Nigeria have formally requested President Bola Ahmed Tinubu to provide detailed clarification regarding how the Federal Government arrived at the reported N3.3 trillion debt said to be owed to operators within the nation's electricity sector. This request comes amid growing concerns over significant discrepancies between this publicly announced figure and previously reconciled industry financial records.
Discrepancies Between Announced Debt and Reconciled Figures
The generation companies have expressed serious reservations about the computation methodology used to determine the N3.3 trillion debt figure, noting that it does not correspond with amounts previously agreed upon during comprehensive reconciliation exercises involving all market participants and relevant government agencies. These reconciliation processes were designed to establish accurate financial positions within the electricity value chain.
This clarification request coincides with the Federal Government's initiation of a N3.3 trillion payment plan specifically designed to clear longstanding liabilities within the power sector and ultimately stabilize electricity supply across Nigeria. In announcing this substantial settlement program, the Presidency indicated that the figure followed a final review conducted under the Presidential Power Sector Financial Reforms Programme, covering legacy debts accumulated between February 2015 and March 2025.
Implementation Progress and Industry Concerns
Following government verification processes, N3.3 trillion was officially adopted as a full and final settlement figure. Implementation has already commenced, with fifteen power plants having signed settlement agreements collectively valued at N2.3 trillion. Government sources have further indicated that N501 billion has been raised to support the disbursement process, with N223 billion already released to beneficiaries while additional payments continue to be processed.
Despite these developments, generation companies maintain that the amount currently being referenced by government authorities does not align with figures previously reconciled with relevant agencies during sector-wide reviews that were conclusively finalized in March 2025. This discrepancy has raised questions about transparency and accuracy in financial reporting within the electricity market.
Industry Leaders Call for Transparency and Consistency
Dr. Joy Ogaji, Chief Executive Officer of the Association of Power Generation Companies, emphasized that the figure currently being referenced differs substantially from reconciled positions reached with relevant authorities following the last comprehensive settlement review concluded in March 2025. "We need to understand how this N3.3 trillion was computed," she stated clearly. While acknowledging the existence of outstanding financial obligations within the power sector, Dr. Ogaji stressed that any publicly stated figure must reflect mutually verified records to preserve transparency and credibility within Nigeria's electricity market.
Power sector expert Dr. Ade Olaniyi also called for improved clarity and consistency in financial disclosures across the entire electricity value chain, warning that conflicting figures could significantly complicate efforts to resolve longstanding liquidity challenges that have plagued the industry for years. "There must be consistency in the figures being communicated to stakeholders," he cautioned. "Without a clear breakdown, it becomes difficult to align on any repayment framework or long-term solution."
Detailed Breakdown Requested Amid Broader Reform Efforts
The generation companies are specifically seeking a detailed explanation of the complete debt profile, including components such as:
- Legacy liabilities accumulated over previous years
- Subsidy-related shortfalls in payments
- Other financial components contributing to accumulated obligations
This request emerges amid ongoing government efforts to address persistent liquidity constraints within the power sector and settle outstanding payments owed to market participants as part of broader electricity reform measures. The resolution of these financial discrepancies is viewed as crucial for restoring investor confidence and ensuring the sustainable operation of Nigeria's electricity generation infrastructure.
