The Minister of Power, Adebayo Adelabu, has urged Nigerians to embrace cost-reflective tariffs.
He said the economy cannot sustain the payment of subsidies indefinitely.
He made this known while meeting with the Chairman of Generating Companies of Nigeria (GenCos), Dr. Joy Ogaji in Abuja.
This was contained in a press statement his special adviser, strategic communications and media relations, Bolaji Tunji, issued on Sunday.
The statement noted that “He (Adelabu) emphasised the need for full liberalisation of the power sector, urging Nigerians to embrace cost-reflective tariffs.”
It also quoted the minister as saying
“Citizens must pay the appropriate price for the energy consumed. The Federal Government will continue to provide targeted subsidies for economically disadvantaged Nigerians. We have to understand that our economy cannot sustain subsidies indefinitely.”
The statement said the federal government has vowed to urgently address the N4 trillion debt crippling Nigeria’s power generation sector.
The move aims to avert an imminent collapse of the power infrastructure in the country.
The Minister assured GenCos executives that the government would prioritise immediate payment of a significant amount out of the N4b debt, while the balance would be defrayed through other debt instruments.
He said this would be proposed in a meeting being planned between President Bola Ahmed Tinubu and GenCos’ leadership.
“There is a need to pay a substantial amount of the debt in cash. At the minimum, let us pay a substantial amount, then ask for a debt instrument in promissory notes to pay the rest”.
He assured the payment of the outstanding balance within six months through financial instruments such as promissory notes.
“We recognise the urgency of this matter. The government is committed to resolving this debt to stabilise the sector and prevent further crisis,” Adelabu stated, adding that President Bola Tinubu would meet with GenCos leadership to fast-track the process.
The GenCoS was led by the Chairman of Mainstream Energy Solutions, who is also the Chairman of the Association of Power Generating Companies (APGA), Col. Sani Bello, who had earlier sounded the alarm over the sector’s dire state, citing the N4 trillion debt as a critical threat to operations. He also warned that liquidity challenges had left GenCos unable to secure loans or maintain infrastructure. “Without urgent intervention, the entire power ecosystem could collapse,” he stressed.
Kola Adesina, Chairman of Egbin Power and First Independent Power Limited, echoed the urgency: “This is a national emergency. Everything hinges on power—industries, homes, hospitals. We cannot afford to let the sector fail.”
Adelabu acknowledged the government’s role in the sector’s struggles, pledging to not only clear the debt but also implement reforms to ease operational bottlenecks.
Meanwhile, Ogaji detailed systemic challenges undermining GenCos, including chronic payment defaults, erratic gas supply, and foreign exchange volatility. She noted that the naira’s plunge from ₦157/$1 in 2013 to ₦1,600/$1 had devastated maintenance budgets and loan repayments. “GenCos have borne unsustainable risks—from grid failures to unproductive taxes—while remaining patriotic,” she said.
The Minister outlined plans to transition the sector toward sustainability, including regulatory reviews to reduce levies and enhance market stability. He also urged GenCos to collaborate on advocacy efforts to educate Nigerians on efficient electricity use and tariff realities.
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