The Federal Government has raised about N1.23 trillion through two bond issuances under its Presidential Power Sector Debt Reduction Programme, as part of efforts to settle about N4 trillion in legacy obligations owed to electricity Generation Companies (GenCos).

The Chief Executive Officer of Nigerian Bulk Electricity Trading Plc (NBET), Akin Odeyemi, disclosed this in Abuja on Monday, according to the News Agency of Nigeria (NAN).

Odeyemi said the government raised N728.9 billion through the second series of the programme, following the N501 billion secured from the inaugural issuance in January.

He said the second series, launched in August, attracted 11 GenCos, compared with eight that participated in the first transaction.

According to him, the wider participation indicates increasing confidence among stakeholders in the debt reduction initiative.

Odeyemi explained that the N728.9 billion raised under Series 2 would be deployed in two tranches, identified as Tranches A and B.

He said the accumulation of unpaid obligations had weakened the financial position of companies across the electricity market and constrained GenCos from expanding their generation capacity.

The NBET chief said the programme was designed not only to clear outstanding liabilities but also to inject liquidity into the Nigerian Electricity Supply Industry and rebuild confidence among market participants.

Minister of Finance and Coordinating Minister of the Economy, Taiwo Oyedele, said the Series 2 transaction comprised N402 billion in cash bonds and N326.9 billion in non-cash bonds allocated to participating GenCos under the Presidential Power Sector Debt Reduction Programme.

Oyedele said the issuance was aimed at addressing accumulated debts that had undermined liquidity and confidence across the electricity value chain.

He, however, noted that clearing the debts alone would not resolve the sector’s broader financial problems.

Oyedele called for stronger market discipline, improved revenue collection, reduced technical and commercial losses, and greater accountability among stakeholders in the electricity sector.

He said the Federal Government was leveraging the domestic capital market to settle verified legacy obligations through a structured and transparent process.

Minister of Power, Joseph Tegbe, said the bond issuance reflected the government’s commitment to tackling structural problems affecting the electricity industry.

Tegbe, who was represented by the ministry’s Permanent Secretary, Mahmuda Mamman, said the initiative was intended to improve the financial health of the sector and support efforts to achieve more reliable electricity supply.

The Special Adviser to President Bola Tinubu on Oil and Gas, Olu Verheijen, said the first series produced settlement agreements with 11 GenCos covering 21 power plants.

She said the second series would expand on the foundation established under the initial phase of the debt reduction framework.

The Federal Executive Council had earlier approved a N4 trillion Power Sector Debt Reduction Initiative following a comprehensive verification of outstanding liabilities.

The verification exercise reduced the claims from more than N4 trillion to about N3.3 trillion after a line-by-line assessment of services provided.

Under Series 1, N333 billion has so far been paid to eight participating GenCos covering 17 power plants.

The first coupon payment of about N63.5 billion on the seven-year bond was fully settled on July 14, 2026.

The government said the payment enabled the participating GenCos to meet financial obligations to gas suppliers, lenders and operations and maintenance contractors.

The second issuance is expected to complete the first phase of the debt settlement programme and extend payments to additional participants across the electricity value chain.

In January, the Federal Government announced that its N501 billion inaugural bond under the Presidential Power Sector Debt Reduction Programme was fully subscribed.