The Federal Government has raised ₦501 billion through its first power sector bond, recording full subscription from institutional investors.
The bond is aimed at settling longstanding debts owed to power generation companies and easing liquidity challenges in Nigeria’s electricity sector.
The bond was issued under the Presidential Power Sector Debt Reduction Programme (PPSDRP) and executed by NBET Finance Company Plc. It closed at ₦501 billion, made up of ₦300 billion raised from the capital market and ₦201 billion allotted to participating power generation companies.
Speaking at the signing ceremony in Lagos on 28 January 2026, the Special Adviser to the President on Energy, Olu Arowolo Verheijen, said the programme marked a turning point for the electricity market. She described it as “a decisive reset of the electricity market, combining debt resolution with broader financial and structural reforms.”
Under the programme, verified debts for electricity supplied between February 2015 and March 2025 are being settled through negotiated agreements with generation companies. Five firms — First Independent Power Limited, Geregu Power Plc, Ibom Power Company Limited, Mabon Limited and Niger Delta Power Holding Company Limited — covering 14 power plants nationwide, have signed settlement agreements with the Nigerian Bulk Electricity Trading Plc (NBET).
The total negotiated settlement for the five companies is ₦827.16 billion, to be paid in four instalments. Proceeds from the Series 1 bond will fund the first two instalments, estimated at ₦421.42 billion, representing about 50 per cent of the total amount. Payments will be made through a mix of cash and notes.
Group Managing Director of Sahara Power Group, Kola Adesina, said the settlement would unlock fresh investment.
“Capital formation can only come when there is confidence, when you can truly see a line of sight in recovering investments previously made,” he said. “Once this process is over, construction will commence immediately on the second phase of our Egbin Power Plant.”
Government officials said clearing the arrears would improve liquidity for generation companies and strengthen their ability to meet operating and debt obligations.
According to figures released by the Office of the Special Adviser on Energy, the programme will impact 4,483.60MWh/h of generation capacity and finalise payment for 290,644.84GWhr of electricity billed since February 2015. It is expected to support companies serving about 12.03 million active registered customers nationwide.
Verheijen said the government remained committed to the reforms.
“The Federal Government reaffirms its commitment to disciplined implementation of the programme,” she said, adding that it aims to build “a financially sustainable electricity market that is capable of supporting Nigeria’s long-term economic growth.”
CardinalStone Partners Limited led the bond issuance as financial adviser and issuing house, with NBET acting as transaction sponsor.
