11 December 2025
The Federal Government has introduced a N4tn power sector liquidity bond to address decade-long debts owed to electricity generation companies.
This move aims to restore confidence in Nigeria’s troubled electricity supply industry
The bond will be fully captured in the country’s Medium-Term Expenditure Framework, ensuring credibility and guaranteeing repayment.
The debt instrument is backed by a sovereign guarantee, providing assurance to investors.
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The bond will cover the N4tn debt owed to power generation companies.
The nation’s public debt will increase by N4tn.
The initial tranche, part of a wider N4tn NBET Finance Company Plc Bond Programme, comprises N300bn in cash bonds and N290bn in non-cash bonds.
The bond has a seven-year tenor with a fixed-rate coupon, redeemed on an amortizing basis and paid semi-annually in arrears.
The government has stepped in with a guarantee to cover potential shortfalls from Generation Companies (GenCos) or Distribution Companies (DisCos).
The bond aims to inject liquidity into the power sector, making it financially viable.
The bond will form the foundation for the sector’s next phase of development.
The SPV, sponsored by the Nigerian Bulk Electricity Trading Plc, will ring-fence historic liabilities and receivables.
This initiative marks a significant step towards resolving the power sector’s financial challenges and promoting economic growth.
