Nigeria’s 23 electricity generation companies have issued a warning about a potential collapse in power supply, citing a deepening financial crisis that has left over N4 trillion in unpaid debts.
The companies, operating under the Association of Power Generation Companies (APGC), declared on Monday that they may be forced to shut down operations if urgent action is not taken by the Federal Government and key stakeholders.
In a statement signed by the Chairman of the APGC Board of Trustees, Colonel Sani Bello (retd), the GenCos lamented the Federal Government’s failure to present a concrete financial intervention plan amid mounting operational and fiscal challenges.
The warning comes as Nigeria’s national grid continues to depend heavily on the power generated by these companies.
The GenCos accused the Nigerian Bulk Electricity Trading Plc (NBET) and other market stakeholders of unfair treatment in the implementation of the sector’s “waterfall arrangement”—a system that prioritises full payments to some service providers while leaving GenCos with just 9 to 11 per cent of their invoiced payments.
According to the GenCos, the chronic underpayment for power already delivered into the grid is not only hampering their ability to maintain operations but is also pushing the entire electricity supply chain towards systemic failure.
They noted that without immediate government intervention, the consequences could extend beyond power outages to broader national security risks.
“The GenCos are constrained to issue this press release to draw the attention of the Federal Government and key stakeholders to the urgent need to address the issue of inadequate payment for electricity generated and consumed on the national grid,” the statement read.
“The liquidity crisis is undermining our ability to meet obligations and threatens to unravel the entire electricity value chain.”
The financial strain is rooted in years of accumulating debt, with Power Minister Adebayo Adelabu revealing in February that over N4 trillion is owed across the power sector.
Of this sum, N2 trillion is legacy debt owed to GenCos, with an additional N1.9 trillion due to them for subsidised electricity supplied in 2024. Distribution companies (DisCos) are also reportedly owed N450 billion in subsidies for the same period.
The GenCos have now urged the government to take swift and decisive action to prevent a total shutdown of the nation’s power infrastructure and the accompanying social and economic fallout.
