Naira Gains and Investor Confidence Soar as FG’s ₦501 Billion Power Sector Bond Hits 100% Subscription

In a move hailed as a "decisive reset" for the nation’s struggling energy landscape, the Federal Government of Nigeria officially closed its inaugural ₦501 billion Series 1 Power Sector Bond this week. The bond, which recorded a 100% subscription rate, marks the first major victory of the Presidential Power Sector Debt Reduction Programme (PPSDRP).

The issuance aims to untangle a decade-long web of debt that has crippled the Nigerian Electricity Supply Industry (NESI). By clearing legacy arrears, the government hopes to restore the liquidity necessary to keep the lights on across the continent’s largest economy.

A Market Vote of Confidence

The ₦501 billion raise was split into two components:

• ₦300 billion raised directly from the capital markets (pension funds, banks, and asset managers).
  
  

• ₦201 billion in bonds allotted to power generation companies (GenCos) that signed settlement agreements.

Minister of Finance Wale Edun, represented by the Director-General of the Debt Management Office (DMO), Patience Oniha, noted that the full subscription sends a "clear and reassuring signal" that investors believe in the current administration's reform agenda.

"This is not a bailout; it is a balance-sheet reset," said Olu Verheijen, Special Adviser to the President on Energy. "It clears verified arrears and gives power generation companies the footing they require to operate and invest with confidence."

Who Benefits?

To date, five major GenCos representing 14 power plants have signed on to the debt settlement framework, including:

1. Geregu Power Plc
   
   
   

2. Niger Delta Power Holding Company (NDPHC)
   
   
   

3. First Independent Power Limited (FIPL)
   
   
   

4. Ibom Power Company Limited
   
   
   

5. Mabon Limited

These companies have negotiated a total settlement of ₦827.16 billion, to be paid in four phases. The proceeds from this first bond will cover roughly 50% of that amount, providing immediate cash flow to stabilize operations.

The Road to 2026

This ₦501 billion tranche is just the beginning of a broader ₦4 trillion multi-instrument programme. With the successful closure of Series 1, the government is already looking toward Series 2, which is expected to launch in early March 2026 with a target size of ₦730 billion.

Industry leaders are already reacting. Kola Adesina, Group Managing Director of Sahara Power Group, announced that the resolution of these debts would allow for the immediate commencement of construction on the second phase of the Egbin Power Plant.

The Bottom Line for Nigerians

While bond papers and "balance-sheet resets" may seem like high finance, the end goal is practical: reliability. By paying off the 290,644 GWh of electricity billed since 2015, the government is removing the primary excuse for low generation.If the liquidity flows as intended, the industry expects to unlock over 4,400 MWh/h of generation capacity that has been stalled by debt.