The Federal Government says it remains committed to improving electricity supply across Nigeria and clearing outstanding debts owed to power generation companies, known as Gencos.
The Minister of Power, Joseph Tegbe, disclosed this at the Harvard Business School Association of Nigeria (HBSAN) Energy Conference in Lagos, where he discussed efforts to strengthen the country's power sector.
According to the minister, about N1.23 trillion of the outstanding legacy debt owed to Gencos has so far been settled through bonds, while the remaining balance is expected to be cleared next year.
Tegbe said the government's objective is not only to settle the existing debt but also to prevent new arrears from accumulating.
He explained that maintaining a healthier payment system would help improve confidence in the electricity market, attract investment and enable power generation companies to make better use of available generating capacity.
The Federal Government also says it intends to ensure that vulnerable Nigerians are protected as reforms in the electricity sector continue.
The government's broader objective is to create a power sector capable of supporting households, businesses and industries with more reliable electricity.
Clearing the legacy obligations to Gencos is therefore being presented as part of a wider effort to improve liquidity in the sector and make it more attractive to investors.
However, settling the debt alone will not automatically translate into uninterrupted electricity supply. Transmission constraints, distribution challenges, gas availability, infrastructure and the ability of electricity consumers and distributors to pay for power will also influence how much electricity ultimately reaches homes and businesses.
For millions of Nigerians, the real measure of the government's electricity reforms will ultimately be more reliable power and fewer hours spent relying on generators.
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