FG to float N729bn bond Tuesday to settle power sector debts, boost liquidity
The Federal Government is set to issue a second bond worth N729 billion under the Presidential Power Sector Debt Reduction Programme, PPSDRP, as part of efforts to clear verified legacy debts owed to electricity Generation Companies, Gencos, and improve liquidity in the Nigerian Electricity Supply Industry, NESI.
The Nigerian Bulk Electricity Trading Plc, NBET, said on Sunday that an investors’ forum will hold on Tuesday, July 21, to engage prospective investors ahead of the issuance.
The planned bond follows the successful issuance of a N501 billion bond in January 2026. Together, the two issuances will total about N1.23 trillion, completing the first phase of the N4 trillion debt reduction programme approved by President Bola Tinubu to address longstanding obligations in the power sector.
In a statement in Abuja, NBET said the first coupon and principal repayment on the January bond, which fell due on July 14, had been settled in full and on time.
“This demonstrates the Federal Government’s creditworthiness, its commitment to meeting contractual obligations, and its resolve to strengthen investor confidence in the programme,” the agency said.
NBET explained that the N1.23 trillion to be raised through the first and second issuances represents Series 1 and Series 2 of the Capital Market Multi-Instrument Issuance Programme, the first phase of the broader N4 trillion initiative.
According to the agency, the January issuance reflected a fiscally responsible approach to settling verified Genco obligations while improving liquidity and supporting the long-term sustainability of the electricity market.
*“Market-based mechanism to restore confidence”*
NBET Chief Executive Officer, Mr. Johnson Akinnawo, described the proposed second issuance as another major milestone toward restoring financial stability in the sector.
“The second issuance demonstrates the Federal Government’s commitment to resolving verified legacy obligations through a transparent, structured and market-based mechanism,” he said.
He said improving liquidity across the electricity value chain would strengthen the financial position of market participants, encourage fresh investment and support sustainable power generation.
Akinnawo recalled that the Federal Executive Council approved the N4 trillion PPSDRP in 2025, with NBET designated as the sponsoring institution for settling verified legacy debts.
He explained that the programme would be implemented through multiple issuances by NBET Finance Company Plc, a special purpose vehicle established for the purpose.
According to him, the instruments are backed by the full faith and credit of the Federal Government and supported by a comprehensive risk mitigation framework.
“The programme has the full backing of the Federal Government and incorporates a robust suite of instruments designed to mitigate transaction risks and support successful execution,” he said.
Akinnawo added that the planned N729 billion bond would be another important step toward resolving longstanding liabilities and creating a more stable, bankable and investment-friendly market.
“By improving liquidity across the electricity value chain, the programme will help strengthen the financial position of market participants, support new investment and promote sustainable electricity generation for the benefit of Nigerians,” he said.