Nigeria issued ₦501 billion ($347 million) in bonds to begin settling more than a decade of debt owed to electricity generation companies, the Africa Finance Corporation said Tuesday.
The deal is the first tranche of a ₦4 trillion ($2.77 billion) bond program under the Presidential Power Sector Financial Reforms Program.
Proceeds will be used to pay verified arrears for power supplied between February 2015 and March 2025.
The AFC advised the federal government on the transaction, working alongside CardinalStone Partners.
About 50% of the financing came from domestic pension funds, helping to mobilize local capital for infrastructure.
The bond program channels pension funds into infrastructure, clears arrears for power producers, and resets market confidence, creating conditions for stable electricity supply and new investment across Nigeria’s energy landscape.
“This transaction lays the foundation for sustainable growth and improved electricity supply,” said Banji Fehintola, AFC board member and head of financial services.
The initiative is led by the Presidential Power Sector Debt Reduction Committee and implemented through NBET Finance Company Plc, a special purpose vehicle of Nigerian Bulk Electricity Trading Plc. The Office of the Special Adviser to the President on Energy provided technical oversight.
Special Adviser Olu Verheijen said the program marks a “decisive reset” of the electricity market, combining debt resolution with broader reforms.
The full program is expected to impact 5,398 megawatts of generation capacity and cover nearly 291,000 gigawatt-hours of electricity billed since 2015.
