Presidency Clarifies ₦3.3trn Settlement Plan Approved For GenCos By Tinubu
The Presidency on Thursday clarified controversy surrounding the approval of a ₦3.3 trillion plan by President Bola Tinubu, to settle verified legacy debts owed to Power Generation Companies (GenCos) between February 2015 and March 2025.
The initiative, under the Presidential Power Sector Financial Reforms Programme, aims to stabilise the power grid and improve electricity supply, with ₦223 billion already disbursed.
A statement issued on Sunday by the special adviser to the President on information and strategy, Bayo Onanuga, stated that implementation of the repayment plan has already begun, with 15 power plants already signed settlement agreements totalling ₦2.3 trillion.
The approval, however, soon generated controversy among GenCos, who asked Tinubu to clarify how the Federal Government arrived at the reported ₦3.3 trillion debt, raising concerns over discrepancies between the figure and reconciled industry records.
Reservations were made over the computation of the debt figure, noting that it does not correspond with amounts previously agreed upon during reconciliation exercises involving market participants and government agencies.
In response to their demand, a statement by The Presidency noted that the debt settlement approval is geared towards addressing financial challenges in the power sector, not a reward beyond service delivery.
“The Federal Government of Nigeria is implementing a structured and balanced reform programme to address longstanding financial challenges in the power sector.
“At the core of this effort is a market-based settlement mechanism designed to restore the sector, not reward accumulated claims that extend beyond verifiable service delivery. The objective is to ensure fairness to operators while also protecting the interest of the Nigerian public.
“Between 2015 and 2025, the sector accumulated approximately ₦4.7 trillion in claims across the electricity value chain.
“Following a Presidential stakeholder meeting in July 2025, where the claims of N4.7trillion were presented, a thorough review was recommended by President Bola Tinubu. On August 15, 2025, a ₦4 trillion fiscal cap was approved by the Federal Executive Council, following which a comprehensive verification process was undertaken to verify claims.
“This resulted in a 30 percent reduction in claims, leading to a final negotiated settlement of ₦3.3 trillion, reflecting only valid and contract-backed obligations.
‘To ensure sustainability and avoid fiscal pressure, the settlement is being implemented through a phased, market-based financing framework”, the statement read in part.
The Presidency noted that a total series consisting of I Programme Size approximately ₦1.23 trillion will be implemented, adding that disbursement of series I, phase I (January 2026), with ₦501 billion raised from the domestic capital market, is already underway.
The Presidency confirmed that a total of ₦223 billion has been disbursed to GenCos and gas suppliers, while ₦197 billion is in process, largely for gas-related obligations.
It noted that all disbursements are phased and conditional, based on verified claims, signed settlement agreements, and completed documentation.
