GenCos decry ₦4tn federal debt, warn of power sector crisis

From Isaac Anumihe, Abuja

Electricity Generation Companies (GenCos) have raised alarm over a ₦4 trillion debt owed by the Federal Government, comprising ₦2 trillion for 2024 and over ₦1.9 trillion in legacy debts.

In a statement on Monday, April 14, GenCos lamented the absence of solutions like cash payments or debt swaps, noting that the 2025 budget’s ₦900 billion allocation falls short of covering arrears and future payments.

“The power generated by GenCos is consumed in full without full payment,” the statement read, citing issues like the partial activation of contracts since July 2022, forex volatility, and a supplementary Multi-Year Tariff Order (MYTO) leaving 90% of invoices unpaid.

GenCos criticised the payment waterfall in the Nigerian Electricity Supply Industry (NESI), which prioritises entities like NERC and NBET, leaving GenCos with just 9–11% of invoices.

“This is a clear departure from Power Purchase Agreements,” they said, urging priority payment to sustain electricity production.