Nigeria’s electricity sector is teetering on the brink of collapse due to a crushing ₦4 trillion debt burden owed to power generation companies, Power Minister Adebayo Adelabu revealed during critical discussions at the Presidential Villa.
The massive liability, accumulated since 2015, now poses severe risks to operational stability and investor confidence in the nation’s electricity market.
Minister Adelabu painted a grim picture of potential generation shutdowns if immediate liquidity support fails to materialize. Such an event would deliver a catastrophic blow to Nigeria’s economy, potentially wiping out the hard-won progress made in recent years. The warning came during high-stakes talks between President Tinubu and power sector stakeholders, including generation company executives and financial leaders.
To avert disaster, the minister proposed a three-pronged emergency approach. First, partial debt payments would provide temporary relief to keep plants operational while comprehensive audits verify the full extent of liabilities. Second, urgent measures would unlock 800 million cubic feet of gas through NLNG to address critical shortages, particularly in the Afam generation corridor where unpaid suppliers have severely constrained output. Third, the government appealed for continued patience from creditors and investors as it works to validate all outstanding claims.
Despite the looming financial crisis, Adelabu highlighted significant achievements since the current administration took office in May 2023. The sector has seen restored investor confidence, measurable improvements across the electricity value chain, and the establishment of foundational reforms aimed at creating a self-sustaining power market.
The minister emphasized that electricity remains the cornerstone of Nigeria’s industrial and economic aspirations, expressing confidence that with sustained presidential support, the sector could overcome its legacy challenges to deliver stable, affordable power nationwide.
The high-level meeting brought together key government figures including the Chief of Staff to the President, the Ministers of Finance and Information, the Special Adviser on Energy, along with generation company chairmen and prominent industry leaders.
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