•Blackout
Power generation companies have said that their long-time patriotism to the nation can no longer keep the power plants running, especially in the face of a fresh N1.2tn debt incurred in the first half of 2025, which increased the total debt to Gencos at N5.2 trillion.
This was as the Minister of Power, Adebayo Adelabu, through his media aide, Bolaji Tunji, told our correspondent yesterday that efforts were being made to defray part of the debt, reports The PUNCH.
In a statement signed by the Chief Executive Officer of the Association of Power Generation Companies, Dr Joy Ogaji, yesterday, the GenCos warned that the power sector is heading toward collapse, unless the federal government urgently addresses its deepening liquidity crisis.
Ogaji said the Gencos have been patriotic for years by generating electricity despite mounting debts and losses, warning, however, that the patriotism is no longer enough to keep the lights on.
“Gencos are patriotic to the national course, and this has been demonstrated, up until now, but patriotism alone cannot keep the machines operational and keep the lights on” Ogaji stated, lamenting the growing debt burden and the unfunded assumptions underpinning recent electricity tariff decisions.
According to her, the Nigerian power industry is facing an outstanding debt of over N4tn — made up of N2tn from unpaid 2024 invoices, N1.9tn in legacy debts from 2015. She disclosed that there is another N1.2tn debt from energy supplied in the first six months of 2025, yet there is no payment plan in place, even as Gencos’ invoices averaged N250bn monthly.
She stated that “there is no FG policy on subsidies; it is debt accumulation.
“The Gencos’ monthly generation invoices average at about N250bn. The federal government budgeted only N900bn for 2025, which is not cash-backed till this morning (July 21).
“Recall that Gencos are currently owed about N4tn (N2tn for 2024 and N1.9tn in legacy debts from 2015), with an accumulated debt of N1.2tn for the first half of 2025 alone. There are NO workable solutions, including cash payments, financial instruments, and debt swaps in sight at the moment.
“The 2025 government budget allocates only N900bn, raising concerns about its adequacy to cover arrears and future deficits. The power generated by Gencos has continued to be consumed in full without corresponding full payment,” she lamented.
The APGC boss mentioned that there were instances where Gencos have had to resort to other means other than the electricity market to support the gas and other services, just to put power on the national grid.
“From Genco’s point of view, investing to increase the capacity of their power plants in the Nigerian electricity market translates to more risks in terms of machine breakdown, maintenance and repair costs. This portends a huge contagion that needs to be dealt with immediately,” it was stated.
Ogaji opposed the Enugu Electricity Regulatory Commission’s planned reduction of Band A electricity tariffs from N209 per kilowatt-hour to N160/kWh from August 1, warning that the decision relies on questionable subsidy assumptions and poses serious risks to the country’s fragile power sector.
Minister reacts
The power minister stated that he was concerned about the mounting debt, which now stands at over N5 trillion.
Speaking through his spokesperson, Tunji, the minister said he had raised the issue at the appropriate quarters, expressing optimism that a part of the debt would be paid.
“I know the minister is concerned and has raised the issue at the appropriate quarters. Efforts are presently being made to ensure part of the debt is defrayed,” Tunji said in an interview yesterday.
Asked to give a time for the payment, Tunji said the process is ongoing.
Recall that when the GenCos threatened to shut down their operations, the federal government had a meeting with them and made promises, including a meeting with President Bola Tinubu..
On May 5, Tunji said the federal government had resolved to settle a substantial portion of the debt immediately, while the remainder would be cleared through financial instruments such as promissory notes within the next six months. However, the GenCos lamented that none of the promises were fulfilled over two months later.
