FG to Issue ₦729bn Bond Next Week to Clear GenCos’ Legacy Debts, Boost Power Sector Liquidity

The Federal Government is set to issue a fresh ₦729 billion bond next week as part of efforts to settle verified legacy debts owed to electricity generation companies (GenCos) and improve liquidity across Nigeria’s power sector.

The proposed issuance will mark the completion of the first phase of the ₦4 trillion Presidential Power Sector Debt Reduction Programme, following the successful issuance of about ₦501 billion in January 2026.

Together, the two issuances make up the ₦1.23 trillion Series 1 and Series 2 component of the Capital Market Multi-Instrument Issuance Programme.

The Chief Executive Officer of the Nigerian Bulk Electricity Trading Plc (NBET), Johnson Akinnawo, disclosed that the bond represents a major step in addressing outstanding financial obligations within the Nigerian Electricity Supply Industry (NESI).

According to him, the programme was approved by President Bola Tinubu to resolve verified legacy debts accumulated within the electricity value chain and strengthen the financial position of key market participants.

Akinnawo said the January 2026 bond issuance was part of the Federal Government’s structured approach to settling obligations owed to GenCos while improving sector liquidity and creating a more sustainable electricity market.

He described the upcoming ₦729 billion issuance as another milestone in efforts to restore confidence among investors and support long-term investment in Nigeria’s power sector.

“The second issuance demonstrates the Federal Government’s commitment to resolving verified legacy obligations through a transparent, structured and market-based mechanism,” Akinnawo said.

He added that improved liquidity across the electricity value chain would strengthen the financial position of industry players, encourage fresh investment and support sustainable electricity generation.

The NBET chief executive recalled that the Federal Executive Council (FEC) approved the establishment of the ₦4 trillion Presidential Power Sector Debt Reduction Programme in 2025, with NBET appointed as the sponsoring institution responsible for settling verified legacy debts.

Under the approved framework, the programme will be implemented through multiple debt instrument issuances by NBET Finance Company Plc, a special-purpose vehicle created for the initiative.

The instruments are backed by the full faith and credit of the Federal Government of Nigeria and supported by risk-mitigation measures designed to ensure successful execution.

Akinnawo said the latest bond issuance would help address longstanding financial challenges in the power sector and create a more stable and investment-friendly electricity market.

He noted that resolving legacy debts remains critical to improving electricity supply, attracting private sector investment and supporting Nigeria’s broader economic growth objectives.