The Nigerian Bulk Electricity Trading (NBET) says it has begun settling legacy debts owed to participating generation companies (GenCos) and their associated gas suppliers.

The payments are being made under the Presidential Power Sector Debt Reduction Programme, the company said in Abuja on Friday.

NBET managing director, Akin Odeyemi, said the payments followed the successful issuance and signing of N728.979 billion Series 2 bonds under the N4 trillion Power Sector Multi-Instrument Issuance Programme.

Mr Odeyemi described the development as a significant milestone in implementing the debt reduction programme under President Bola Tinubu’s administration.

He said the initiative also supported the objectives of the federal government’s Renewed Hope Agenda.

According to him, the settlement comprises N402 billion in cash bonds and N326.979 billion in non-cash bonds, in line with the approved settlement framework.

Mr Odeyemi said the ongoing settlement would help address historical financial obligations and restore liquidity across the electricity value chain.

He added that the initiative would strengthen the financial position of participants across the power sector.

“Beyond addressing legacy obligations, this development provides a pathway for the Nigerian electricity market to progressively transition toward a more sustainable market cash-flow framework,” he said.

Mr Odeyemi said the transition would be characterised by improved payment discipline, stronger liquidity and greater commercial certainty to support continued investment across the value chain.

He said a more financially stable generation segment would strengthen GenCos’ capacity to maintain and improve their power generation assets.

According to him, improved financial stability would also support increased electricity generation and enhance reliability across the Nigerian electricity market.

The NBET managing director said the milestone demonstrated the Federal Government’s commitment to resolving longstanding financial obligations in the power sector.

He added that settling the debts would lay the foundation for a financially sustainable, commercially viable and investment-driven electricity market.

Mr Odeyemi said NBET was currently undertaking preparatory activities for the commencement of the programme’s second phase.

He said the company would continue advancing the objectives of the N4 trillion Power Sector Multi-Instrument Issuance Programme.

 (NAN)