FG Reacts as Electricity Generating Firms Move to Shut down over N4 Trillion Debt
- The minister of Power, Adebayo Adelabu, has promised to intervene over the N4 trillion electricity debt owed to GenCos
- Adeblabu disclosed through his special adviser, Bolaji Tunji, that the government is addressing the issue
- He disclosed that the Ministry of Finance will tackle the challenge and try to offset the debt
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Legit.ng’s Pascal Oparada has reported on tech, energy, stocks, investment and the economy for over a decade.
The minister of Power, Adebayo Adelabu, has promised to tackle the N4 trillion electricity debt owed by generating companies (GenCos), which saw electricity distribution companies (DisCos) threatening to shut down on Monday.
The special adviser to the Power minister, Bolaji Tunji, disclosed that the government is aware of the development and is taking steps to resolve the issues.
Source: Getty Images
Ministry of Finance is to tackle debt
Tunji disclosed that the ministry of Finance will take charge of the payment as part of steps by the government to address the debt.
He stated that the government is aware of the debt due to the Nigerian government’s commitment to subsidies, part of which were legacy debts before the current government came to power.
He said the minister of Power has always mentioned the issue as he knows the impact of such debts on the operations of the power sector stakeholders, especially the generating firms.
A nationwide blackout loomed as the 23 GenCos warned that they could no longer guarantee a steady electricity supply due to liquidity challenges, with outstanding debts now exceeding N4 trillion, including N2 trillion for power supplies in 2024 and N1.9 trillion in legacy debts.
The Association of Power Generation Companies (APGC) stated on Monday, April 14, 2025, that the debt burden and operational constraints faced by the firms could lead to a shutdown of power plants nationwide if appropriate measures are not implemented.
GenCos warn of imminent shutdown
The companies noted that plants were being paid less than 30 per cent of monthly invoices for power supplied to the national grid.
They warned that the continued non-payment for electricity generated and consumed on the national grid is forcing the Nigerian power sector towards collapse.
The GenCos lamented the lack of a clear payment plan from the Nigerian government alongside growing operational costs in the electricity industry in Nigeria.
The GenCos accused the Nigerian Bulk Electricity Trading Plc (NBET) and other stakeholders of neglecting them in the NESI’s waterfall arrangement, which allows service providers to get 100% of their market invoices while GenCos get a paltry nine to 11 per cent of what is due.
According to them, power-generating companies are constrained to issue the release to draw the attention of the Nigerian government and key stakeholders to urgently address the issue of inadequate payment for electricity generated by them and consumed on the national grid.
They disclosed that the debt is threatening the continued operation of their power plants.
Punch reports that in February 2025, Adelabu said that the government owes the GenCos and DisCos over N4 trillion in electricity subsidies.
NERC fines GenCos for overbilling consumers
The development comes as Abuja Electricity Distribution Company (AEDC) was fined ₦1.69 billion by the Nigerian Electricity Regulatory Commission for overcharging customers.
As per NERC's statement, the fine is due to AEDC's disregard for the commission's previous order restricting projected billing for power users.
The fine was specified in the official "Order NERC/2024/114" that the commission issued.
The fine is included in the September 2024 Supplementary Order of the commission, which was obtained from NERC's website.
Source: Twitter
It was dated August 30 and signed by Vice Chairman Musiliu Oseni and Commissioner of Legal, Licensing, and Compliance, Dafe Akpeneye.
FG orders reduction of electricity supply to 3 African countries
Legit.ng earlier reported that the Nigerian Electricity Regulatory Commission (NERC) was set to enhance power supply to domestic consumers following its orders directing the System Operator (SO) to cap supplies to international customers by 6 per cent of domestic supplies.
The affected countries include Togo, Benin Republic and the Niger Republic.
The development came amid a high level of indebtedness and non-remittance of electricity bills supplied to the countries over the years.
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Pascal Oparada (Business editor) For over a decade, Pascal Oparada has reported on tech, energy, stocks, investment, and the economy. He has worked in many media organizations such as Daily Independent, TheNiche newspaper, and the Nigerian Xpress. He is a 2018 PwC Media Excellence Award winner. Email:pascal.oparada@corp.legit.ng
Kola Muhammed (Copyeditor) Kola Muhammed is an experienced editor and content strategist who has overseen content and public relations strategies for some of the biggest (media) brands in Sub-Saharan Africa. He has over 10 years of experience in writing and (copy)editing.
