Over 60% of ₦4trn power debt owed to gas suppliers – Adelabu

The Minister of Power, Adebayo Adelabu, has revealed that approximately 60% of the ₦4 trillion debt owed to Generating Companies (GenCos) is held by gas suppliers.

Speaking in Abuja during a performance review of the Nigerian Electricity Supply Industry (NESI), the Minister confirmed that after auditing and reconciliation, the verified debt stands at ₦2.8 trillion, with ongoing discussions to settle the remaining balance which could bring the total to ₦4 trillion.

Adelabu projected a significant turnaround in power supply within the next two weeks, citing the imminent completion of repairs on critical gas infrastructure, including pipelines operated by Seplat.

The Minister further revealed that a specialized committee has been established to track these repairs and ensure gas companies comply with their Domestic Supply Obligations (DSO).

The Minister emphasized that while gas producers are legally required to prioritize the local market, the government recognizes that persistent non-payment has driven many to favor export markets.

He assured stakeholders that the commencement of a structured payment plan would incentivize these suppliers to restore firm contracts with domestic power plants.

Beyond the immediate liquidity crisis, the Minister issued a definitive performance or exit ultimatum to Electricity Distribution Companies (DisCos).

He disclosed that the 15-year operating licenses issued in 2013 are set to expire in 2028, and the government does not intend to offer automatic renewals. Instead, the next two years will serve as a final evaluation period under rigorous new performance standards. Only DisCos that demonstrate measurable improvements in infrastructure revamping and service delivery through initiatives like the Distribution Sector Recovery Programme (DISREP) will be considered for license extensions.

Despite the current challenges, the Minister highlighted a surge in private sector confidence, noting that approximately $2 billion has been invested across the power value chain over the last two years.

These investments are increasingly being channeled into renewable energy via the Distributed Access through Renewable Energy Scale-up (DARES) and the Nigeria Electrification Project (NEP). By bridging the funding gap for gas and enforcing accountability for distributors, the Ministry aims to transition the sector toward a more stable and industrial-friendly energy mix.