By Our Reporter
The Association of Power Generation Companies (APGC) has warned that electricity debts owed by the Federal Government could surge to N8.5 trillion by December if a concrete repayment plan is not urgently implemented.
Speaking in an interview on Trust TV, the Chief Executive Officer of APGC, Joy Ogaji, disclosed that the government’s subsidy commitment to the power sector stands at N250 billion monthly, amounting to about N2.5 trillion annually. However, she noted that only about 35 per cent of this obligation is currently being paid.
“One of the major issues confronting us is liquidity and debt,” Ogaji said. “The implication for our operations is that the debt profile grows by about N2.4 trillion annually. At the moment, there is no clear financing plan—only projections and assumptions. Assumptions cannot buy gas for power generation.”
According to her, the government currently owes power generation companies N6.5 trillion, with only N500 billion proposed as a bond-backed repayment plan and no clear strategy to settle the outstanding balance or halt the accumulating debt.
She explained that the debt has been increasing by roughly N2.4 trillion each year. “Last year it was N2.4 trillion, and if nothing is done, it will add another N2.4 trillion this year. When combined with the December 2024 figure of about N4 trillion—which we discussed with the President in July—the total exposure continues to rise. If urgent steps are not taken, the debt could reach about N8.8 trillion by December.”
Ogaji further stressed that over 90 per cent of power generation operations are dollar-denominated, making the situation more precarious amid foreign exchange constraints.
“Power generation operations are largely dollarised, from maintenance to spare parts procurement,” she said. “Access to foreign exchange remains extremely difficult, and the sector does not receive official dollar allocations. Beyond that, even the 35 per cent payment we receive comes irregularly, making planning nearly impossible. The funding is both inadequate and unpredictable.”
The APGC warned that without a sustainable financing framework and timely payments, the liquidity crisis could further strain power generation capacity nationwide.
