The Federal Government has recorded a major milestone in its power sector reform drive with the successful issuance of a ₦501 billion inaugural bond under the Presidential Power Sector Debt Reduction Programme (PPSDRP), achieving 100 per cent subscription from pension funds, banks, asset managers, and other institutional investors.
The bond issuance marks a significant step towards resolving legacy debts, restoring liquidity, and rebuilding investor confidence in the. The Programme, championed by President Bola Ahmed Tinubu, GCFR, is aimed at addressing long-standing payment arrears owed to power generation companies, debts that have constrained liquidity, weakened balance sheets, and discouraged investment across the power sector for more than a decade.
Speaking at the bond issuance signing ceremony held in Lagos on 27 January 2026, the Special Adviser to the President on Energy, Mrs. Olu Arowolo Verheijen, said the Programme represents a decisive reset of Nigeria’s electricity market, combining debt resolution with wider financial and structural reforms.
The signing 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, made up of ₦300 billion raised from the capital market and ₦201 billion in bonds allotted to participating power generation companies, reflecting strong investor confidence in the Federal Government’s reform agenda.
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Under the Programme, verified receivables for electricity supplied between February 2015 and March 2025 are being settled through negotiated agreements with power generation companies. To date, five generation companies—First Independent Power Limited (FIPL), Geregu Power Plc, Ibom Power Company Limited, Mabon Limited, and Niger Delta Power Holding Company Limited (NDPHC) 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 instalment payments, estimated at ₦421.42 billion, representing about 50 per cent of the total negotiated settlement amount. Payments for this initial phase will be made through a combination of cash and notes.
Speaking on behalf of power generation companies, the Group Managing Director of Sahara Power Group, Mr. Kola Adesina, said the Programme restores investor confidence and unlocks fresh capital for expansion.
“Capital formation can only come when there is confidence, when you can truly see a line of sight in recovering investments previously made. Because we were being owed so much, it was a bit of a problem for us to put in more money. But last year we took the bull by the horns, based on President Bola Ahmed Tinubu’s commitment in resolving the legacy issues, and I can say that once this process is over, construction will commence immediately on the second phase of our Egbin Power Plant. On behalf of the Generation Companies, I’d like to thank the President for this resolution,” Adesina said.
Verheijen acknowledged the leadership of President Bola Ahmed Tinubu, as well as the support of the Minister of Finance and Coordinating Minister of the Economy, Mr. Wale Edun, and the Minister of Power, Chief Adebayo Adelabu, in making the Programme a reality. She also recognised the contributions of members of the Presidential Power Sector Debt Reduction Committee, power sector stakeholders, and government institutions including the Debt Management Office, Central Bank of Nigeria, National Pensions Commission, and the Nigerian Revenue Service.
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 on Energy, which led settlement negotiations with the generation companies.
Reaffirming the Federal Government’s commitment, Verheijen said, “The Federal Government reaffirms its commitment to disciplined implementation of the Programme, and we look forward to the participation of other power generation companies, as part of our broader reforms aimed at building a financially sustainable electricity market that is capable of supporting Nigeria’s long-term economic growth.”
