The Federal Government is set to raise approximately ₦729 billion through a second bond issuance to settle verified legacy debts owed to electricity generation companies (GenCos), in a renewed effort to stabilise Nigeria's power sector and enhance investor confidence.
The proposed issuance, scheduled to be preceded by an Investors' Forum on Tuesday, July 21, will bring the value of the first two bond issuances under the Presidential Power Sector Debt Reduction Programme to about ₦1.23 trillion.
The Nigerian Bulk Electricity Trading Plc (NBET) disclosed the development in a statement on Sunday, saying the new bond follows the successful issuance of about ₦501 billion in January 2026 under the Federal Government's debt resolution initiative.
NBET noted that the first coupon and principal repayment on the Series 1 bond, which fell due on July 14, 2026, was paid promptly and in full, a development it said reflects the government's commitment to meeting its financial obligations and sustaining investor confidence.
According to the agency, the Series 1 and Series 2 bonds form the first phase of the broader ₦4 trillion Presidential Power Sector Debt Reduction Programme approved by President Bola Tinubu to resolve longstanding financial obligations in the electricity sector.
The programme is expected to improve liquidity across the Nigerian Electricity Supply Industry (NESI), strengthen the financial health of operators and create a more sustainable electricity market.
NBET's Managing Director and Chief Executive Officer, Johnson Akinnawo, said the forthcoming bond issue demonstrates the Federal Government's determination to address legacy debts through a transparent and market-driven process.
He explained that resolving the outstanding obligations would improve cash flow across the electricity value chain, encourage fresh investments and support reliable power generation.
"The second issuance reflects the Federal Government's commitment to resolving verified legacy obligations through a transparent, structured and market-based mechanism. It is a critical step towards restoring confidence in the sector and strengthening its long-term sustainability," he said.
Akinnawo recalled that the Federal Executive Council approved the ₦4 trillion debt reduction programme in 2025 and designated NBET as the sponsoring institution responsible for implementing the initiative.
He said the programme would be executed through multiple debt issuances by NBET Finance Company Plc, a special purpose vehicle established to facilitate the settlement of verified liabilities in the power sector.
He added that the debt instruments are backed by the full faith and credit of the Federal Government and supported by risk mitigation measures designed to ensure successful implementation.
Akinnawo expressed optimism that the second bond issuance would mark another milestone in efforts to eliminate the debt overhang that has constrained investments in the electricity industry.
According to him, the initiative is expected to help build a more stable, bankable and investment-friendly electricity market capable of supporting economic growth and improving power supply.
The Federal Government has said the Presidential Power Sector Debt Reduction Programme is designed to resolve verified debts owed to GenCos through a structured financing arrangement while strengthening the financial sustainability of the electricity sector and attracting long-term private investment.
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