Nigeria’s power-generating companies (GenCos) have warned of an imminent power crisis in the face of accumulated N4 trillion debts, which has prompted an emergency intervention by President Bola Tinubu.
The escalating debt, comprising N2 trillion for power supplied in 2024 and N1.9 trillion in legacy debt formed the major plank of discussion at a recent high-level meeting between the Minister of Power, Adebayo Adelabu, and GenCos leadership in Abuja.
The GenCos, led by the Chairman of Mainstream Energy Solutions and head of the Association of Power Generating Companies, Col. Sani Bello (rtd), painted a dire picture of a sector teetering on the brink of collapse due to persistent liquidity challenges.
In response to the GenCos’ urgent appeals, the Federal government has pledged to settle a substantial portion of the debt immediately, with the remainder to be cleared through financial instruments like promissory notes within the next six months. This commitment, as revealed by the Minister’s Special Adviser on Strategic Communications and Media Relations, Bolaji Tunji on Sunday, will be formalized in an upcoming meeting between President Bola Ahmed Tinubu and the GenCos’ leadership.
Minister Adelabu acknowledged the severity of the situation and the government’s determination to avert a potential catastrophe.
“We recognize the urgency of this matter. The government is committed to resolving this debt to stabilize the sector and prevent further crisis,” he stated.
However, the GenCos, through their representative, Col. Sani Bello (rtd), have emphasized that immediate and significant cash injection is crucial to prevent a collapse of the national grid.
“There is a need to pay a substantial amount of the debt in cash. At the minimum, let us pay a substantial amount, then ask for debt instruments in promissory notes to pay the rest,” Bello urged, underscoring the precarious financial position of the power-generating companies.
