February 25, 2026/CSL Update
Recent media reports suggested that President Bola Tinubu approved ₦2.8 trillion as the Federal Government’s audited liability to settle legacy debts owed to Nigeria’s power generation companies (GenCos), significantly lower than the ₦6.0 trillion figure previously claimed by the operators. The reports cited unnamed Presidency and Federal Ministry of Power sources, who said the government undertook a comprehensive audit before committing to any payment and insisted it would not settle amounts above the audited figure.
However, the Association of Power Generation Companies (APGC) has categorically rejected these claims. In a public statement, APGC CEO Joy Ogaji described the reported ₦2.8 trillion figure as inaccurate and misleading, stating that no formally concluded reconciliation or audit process has produced such a settlement figure. She challenged those behind the reports to make the audit methodology and results public, emphasising that the outstanding obligations arise from bilateral commercial agreements under the Nigerian Electricity Supply Industry framework rather than arbitrary totals.
GenCos argue that the energy sector’s legacy debts are structurally determined, based on metered power generated, energy dispatched, and formally invoiced under established market procedures, with settlement reports prepared by the Nigerian Bulk Electricity Trading Plc. They also recall that in July 2025, following a tripartite reconciliation involving GenCos, NBET, the Ministry of Finance, and the Office of the Special Adviser on Energy, the President approved ₦4.0 trillion in recognition of verified legacy obligations after due process and that this figure guided engagements with financial institutions, gas suppliers and investors.
The broader context remains that GenCos continue to warn of a deepening liquidity crisis in the power sector, which they attribute to tariff shortfalls, market settlement deficits, foreign exchange exposure and unpaid invoices. The Presidency’s stance on the other hand, reflects efforts to manage the nation’s burgeoning fiscal deficits by applying haircuts to sector liabilities.
The implications of this dispute are significant. A prolonged disagreement over the quantum and verification of legacy debts risks deepening the liquidity crisis across the Nigerian Electricity Supply Industry, with knock-on effects for gas suppliers, lenders, and distribution companies. If unresolved, it could constrain generation capacity, delay maintenance and expansion investments, and weaken overall grid reliability.
More broadly, persistent uncertainty around contractual sanctity and government settlement credibility may dampen investor appetite for new capital in both the power sector and other infrastructure segments. Conversely, a transparent and structured resolution framework would strengthen market confidence, improve sector stability, and support Nigeria’s broader economic growth ambitions by enhancing energy security and industrial productivity.
Click here to download full report: CSL Nigeria Daily – 25 February 2026 – Economy.pdf
