Tinubu to GenCos: We must verify power sector debts before settlement

President Bola Tinubu has appealed to power generation companies (GenCos) to allow the federal government additional time to complete the verification and validation of longstanding debts, amounting to over N4 trillion, owed to them.

Speaking during a meeting with the Association of Power Generation Companies (APGC) at the Presidential Villa in Abuja, Tinubu acknowledged the inherited liabilities from past administrations but emphasised the need for credible validation before settlement.

“I accept the assets and liabilities of my predecessors, and there is no question about that,” the president stated. “But that acceptance must be on credible grounds.”

“I need to wear the audit cap of verifiability, authenticity, and the fact that this inheritance is not a mere deodorant but a support structure for critical economic and industrial promotion.”

The APGC delegation was led by Sani Bello. Tinubu assured the group that his government remains committed to resolving the liquidity issues troubling the power sector, urging patience from the GenCos and their financial partners.

“We are here. So market it to your other colleagues. Give us time to do verification and validation of the numbers,” he said.

Reaffirming his belief in a market-driven power industry, the president noted that legacy issues are now receiving attention, pointing to recent reforms such as fuel subsidy removal and the introduction of Compressed Natural Gas (CNG) alternatives to reduce costs and support economic stability.

To the banking sector, Tinubu urged caution in handling debts owed by GenCos, advising against harsh measures such as asset foreclosures.

“Sharpen your pencils, but keep an eraser handy. Let’s persevere together,” he said.

He described electricity as “the most important discovery of humanity in the last 1,000 years,” underlining its role in economic development and human dignity.

Meanwhile, Olu Verheijen, the president’s special adviser on energy, revealed that a N4 trillion bond programme has received Tinubu’s anticipatory approval to tackle the power sector’s liquidity crisis.

The debt stems from accumulated unfunded tariff and market shortfalls dating back to 2015.

“We have since sat with 27 GenCos, not all of them are here today, and reviewed their PPAs and gas sales agreements to understand the legitimacy of their claims,” Verheijen said.

She added that the Nigerian Bulk Electricity Trading Company (NBET) has so far validated N1.8 trillion of the claims.

She noted that as of April 2025, the total government exposure to GenCos stands at N4 trillion, though this may be adjusted downward pending final verification.

“Only the amounts that the federal government validly owes are the things that will make it into the issuance by DMO,” she added.

Minister of Power Adebayo Adelabu also lauded President Tinubu for restoring investor confidence in the sector, stressing that recent policy actions have led to measurable improvements across the electricity value chain.