FG’s N501bn Power Sector Bond Records Full Subscription

T The Federal Government has successfully raised ?501 billion in its inaugural bond issuance under the Presidential Power Sector Debt Reduction Programme (PPSDRP), achieving a 100 per cent subscription from pension funds, banks, asset managers and other investors.

The bond issuance marks a major milestone in the Federal Government’s efforts to resolve longstanding legacy debts in the Nigerian Electricity Supply Industry (NESI), restore liquidity and rebuild investor confidence across the power sector value chain.

The programme, championed by President Bola Ahmed Tinubu, is designed to settle verified payment arrears owed to power generation companies, debts that have persisted for over a decade and constrained investment and operational stability in the sector.

Speaking at the bond issuance signing ceremony held in Lagos on January 27, 2026, the Special Adviser to the President on Energy, Mrs. Olu Arowolo Verheijen, described the initiative as a turning point for Nigeria’s electricity market.

“This Programme represents a decisive reset of the electricity market, combining debt resolution with broader financial and structural reforms,” Verheijen said.

The signing ceremony followed the successful completion of Series 1 of the Power Sector Bond Issuance by NBET Finance Company Plc. The Series 1 issuance closed at ?501 billion, comprising ?300 billion raised from the capital market and ?201 billion in bonds allotted to participating power generation companies, reflecting strong investor confidence in the reform agenda.

Under the PPSDRP, verified receivables for electricity supplied between February 2015 and March 2025 are being settled through negotiated agreements with power generation companies. So far, five generation companies — First Independent Power Limited, Geregu Power Plc, Ibom Power Company Limited, Mabon Limited and Niger Delta Power Holding Company Limited — representing 14 power plants nationwide, have executed settlement agreements with the Nigerian Bulk Electricity Trading Plc (NBET).

The total negotiated settlement amount for the five companies stands at ?827.16 billion, to be paid in four phased instalments. Proceeds from the Series 1 bond issuance will fund the first and second instalments, estimated at ?421.42 billion, representing about 50 per cent of the total settlement, to be paid through a combination of cash and notes.

Commenting on the development, Group Managing Director of Sahara Power Group, Mr. Kola Adesina, said the bond issuance would unlock fresh investment in the sector.

“Capital formation can only come when there is confidence, when you can truly see a line of sight in recovering investments previously made,” Adesina said. “Because we were being owed so much, it was a bit of a problem for us to put in more money. Based on President Bola Ahmed Tinubu’s commitment to resolving the legacy issues, once this process is over, construction will commence immediately on the second phase of our Egbin Power Plant.”

By clearing historic arrears, the Federal Government expects the programme to improve liquidity for power generation companies, strengthen their capacity to meet operational and debt obligations, unlock new investments and support a more reliable electricity supply for homes and businesses.

When fully implemented, the programme is projected to impact 4,483.60 megawatt-hours per hour of electricity generation capacity, settle payments for 290,644.84 gigawatt-hours of electricity billed since 2015, and support service delivery to over 12 million active registered electricity customers nationwide.

Verheijen reaffirmed the Federal Government’s commitment to disciplined implementation of the programme and called on other power generation companies to participate.

“We look forward to the participation of other generation companies as part of our broader reforms aimed at building a financially sustainable electricity market capable of supporting Nigeria’s long-term economic growth,” she said.

The Federal Government also acknowledged the roles played by the Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun; the Minister of Power, Chief Adebayo Adelabu; the Presidential Power Sector Debt Reduction Committee; and key institutions including the Debt Management Office, Central Bank of Nigeria and National Pension Commission in the successful execution of the bond issuance.

CardinalStone Partners Limited served as Lead Financial Adviser and Lead Issuing House for the Series 1 bond issuance, working alongside NBET as transaction sponsor and the Office of the Special Adviser to the President on Energy, which led settlement negotiations with generation companies.