Electricity Generation Companies (GenCos) have raised alarm over mounting unpaid debts exceeding ₦6.2 trillion, warning that the financial strain is pushing most operators toward insolvency and threatening Nigeria’s power supply chain.
The disclosure was made by the Chief Executive Officer of the Association of Power Generation Companies (APGC), Joy Ogaji, who said the outstanding amount does not cover all contractual entitlements owed to generation firms.
Ogaji explained that the debt continues to grow because GenCos are not fully paid for the electricity produced, despite bearing high operational costs, including gas procurement, plant maintenance, foreign exchange exposure, and financing obligations.
According to her, the persistent non-payment has left many companies technically insolvent, limiting their ability to maintain infrastructure or invest in expanding generation capacity.
She stressed that GenCos are not beneficiaries of electricity subsidies but rather the most affected by the current market structure.
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“GenCos are only requesting payment of receivables accumulated over the years, as reflected in the Multi-Year Tariff Order and the records of the Nigeria Bulk Electricity Trading for power generated and consumed. However, only about 35 percent is paid,” she said.
Ogaji added that incomplete payments also extend to gas suppliers, worsening inefficiencies across the electricity value chain and contributing to stagnation in the sector’s growth.
She noted that the situation undermines the objectives of the tariff framework designed by the Nigerian Electricity Regulatory Commission to ensure cost recovery, improved performance, and reduced losses across the Nigerian Electricity Supply Industry.
The APGC chief warned that legacy GenCos and Nigerian Independent Power Plants are operating without adequate risk protection, exposing them to operational and regulatory uncertainties.
She emphasized that generation companies have fulfilled their obligations by mobilizing resources for fuel, labour, and operations under approved Power Purchase Agreements, yet payments remain insufficient.
Industry stakeholders say the mounting debt crisis poses a significant threat to Nigeria’s already fragile power sector, with potential consequences for electricity supply, investment, and economic growth if unresolved.
