The Federal Government is holding an Investors’ Forum in Abuja today ahead of the issuance of a ₦729 billion Series 2 Power Sector Bond, the latest step in its plan to settle long-standing debts owed to electricity generation companies (GenCos) and restore financial stability to Nigeria’s power sector. (The Nation Newspaper)
The bond forms the second tranche of the first phase of the ₦4 trillion Presidential Power Sector Debt Reduction Programme (PPSDRP), which was approved to address verified legacy liabilities that have constrained investment and liquidity across the Nigerian Electricity Supply Industry (NESI). The issuance follows the successful ₦501 billion Series 1 bond launched in January 2026. Together, the two transactions amount to approximately ₦1.23 trillion, completing the programme’s first phase. (Vanguard News)
The Investors’ Forum is designed to brief institutional investors, pension fund administrators, banks, insurance companies and asset managers on the structure of the bond and the government’s strategy for resolving the sector’s longstanding debt overhang. The bond will be issued through NBET Finance Company Plc, a special purpose vehicle established by the Nigerian Bulk Electricity Trading Plc (NBET), with the instruments backed by the full faith and credit of the Federal Government. (Vanguard News)
NBET Managing Director and Chief Executive Officer, Johnson Akinnawo, described the planned issuance as another milestone in rebuilding confidence in the electricity market.
“The second issuance demonstrates the Federal Government’s commitment to resolving verified legacy obligations through a transparent, structured and market-based mechanism,” he said, adding that improved liquidity would strengthen investor confidence, attract fresh capital and support more reliable electricity generation. (Vanguard News)
Government officials also highlighted the performance of the inaugural bond, noting that the first coupon and principal repayment, which fell due on July 14, was paid in full and on schedule. They said the successful repayment demonstrates the government’s commitment to honouring its obligations and is expected to bolster investor confidence ahead of the new issuance. (The Street Journal)
The debt reduction programme is intended to address years of unpaid obligations owed to GenCos, which have repeatedly warned that mounting receivables have undermined their ability to maintain generation capacity, pay gas suppliers and invest in infrastructure. Liquidity shortages across the electricity value chain have been cited as a major factor behind persistent supply challenges and unreliable power delivery. (Vanguard News)
While the bond programme represents a significant intervention, disagreements remain over the total amount outstanding. Some generation companies have argued that the government’s verified debt figure understates what is owed and have maintained that many payments announced earlier this year have yet to reach beneficiaries. Industry groups estimate the sector’s accumulated debt has continued to rise, reflecting years of tariff shortfalls, unpaid subsidies and market inefficiencies. (Punch Newspapers)
Analysts say a successful Series 2 issuance would provide a further boost to confidence in Nigeria’s capital markets while easing financial pressures on electricity producers. However, they note that clearing legacy debts alone will not resolve the structural challenges facing the power sector, which also require improvements in cost recovery, transmission infrastructure, distribution efficiency and broader market reforms. (fmino.gov.ng)
