|By Babatunji Wusu
The Chief Executive Officer of the Association of Power Generation Companies (GENCOs), Dr Joy Ogaji, has declared that the Federal Government’s N501 billion power sector bond is grossly inadequate to offset the spiralling legacy debt owed to electricity generation companies.
Speaking on Thursday during an interview on Arise Television, Ogaji revealed that the sector’s indebtedness, which stood at N4 trillion in December 2024, is projected to climb to about N6.6 trillion by the end of February 2026.
She explained that the debt burden has continued to swell by approximately N200 billion every month, intensifying liquidity constraints and threatening the operational stability of power generation companies.
“As of December 2024, it was N4tn. If you calculate N200bn times 12, you know the figure for 2025. And now we are currently in February. So currently it’s above N6tn. We’re looking at about N6.6tn by the end of this month. So that is the figure,” Ogaji stated.
The GENCOs’ boss cautioned that the worsening financial crisis could push Nigeria’s power sector to the brink of collapse if the Federal Government fails to implement an urgent and comprehensive intervention plan.
She recalled that President Bola Ahmed Tinubu had earlier assured stakeholders of plans to clear the N4 trillion debt backlog but noted that the intervention was eventually scaled down to N501 billion.
Her comments come on the heels of the Federal Government’s N501 billion bond programme, which recorded full subscription in January 2026. Despite the successful subscription, stakeholders argue that the amount barely scratches the surface of the sector’s outstanding obligations.
Nigeria continues to battle chronic electricity shortages more than a decade after the privatization of its generation and distribution segments. Although the country boasts an installed capacity of about 15,000 megawatts, actual generation has persistently hovered between 2,000 and 4,000 megawatts, leaving households and businesses grappling with erratic supply and escalating energy costs.
Ogaji urged the government to design and implement a permanent, practical and sustainable framework to liquidate the mounting legacy debt and restore financial stability to the power sector.
