The Federal Government has urged investors to increase their exposure to Nigeria’s power sector as it prepares to issue a second bond valued at about N729bn to settle verified legacy debts owed to electricity generation companies (GenCos).

The planned issuance is part of the Presidential Power Sector Debt Reduction Programme (PPSDRP), designed to address longstanding financial obligations, improve liquidity and strengthen confidence in the Nigerian Electricity Supply Industry (NESI).

Speaking at the Project HOOVER Series II Investment Forum in Abuja, Minister of Power Joseph Tegbe described the bond programme as a major step towards converting years of financial challenges in the electricity sector into investment opportunities.

“Today, I invite you all to deepen your investment position in our power sector — a sector that is being fixed properly, at last,” Tegbe said.

He praised the Nigerian Bulk Electricity Trading Plc (NBET) and the Debt Management Office (DMO) for their role in developing the market-based framework supporting the initiative, while also commending financial advisers and transaction partners involved in structuring the bond.

Special Adviser to the President on Oil and Gas, Olu Verheijen, said investor confidence would grow as government actions continue to address structural weaknesses in the sector.

“We are converting yesterday’s liabilities into today’s liquidity and tomorrow’s investment capacity,” she said, adding that improved liquidity would strengthen the electricity value chain and enhance operational performance.

Finance Minister and Coordinating Minister of the Economy, Taiwo Oyedele, said the bond programme was not merely a fundraising exercise but an effort to rebuild trust, honour obligations and resolve long-running sector challenges.

He noted that the first NBET Power Sector Bond, valued at N501bn and issued in January 2026, was fully subscribed and later listed on the FMDQ Exchange and Nigerian Exchange Group.

Oyedele said the government’s timely repayment of the first coupon and principal obligations on July 14 demonstrated the strength of the programme’s governance structure and institutional backing.

He identified tariff shortfalls, settlement gaps, accumulated debts to GenCos and suppliers, and grid instability as key factors behind the power sector’s liquidity challenges over the past decade.

According to him, these problems required market-based solutions rather than repeated budget interventions. He said a review of sector liabilities authorised by President Bola Tinubu in July 2024 led to the establishment of the Presidential Power Sector Debt Reduction Committee, which developed the framework approved by the Federal Executive Council in August 2024.

NBET officials said the planned Series II bond, estimated at N729bn, would build on the success of the first issuance by providing liquidity to the electricity market and addressing verified obligations to GenCos.

NBET acting Managing Director and Chief Executive Officer Johnson Akinnawo said the inaugural bond had improved liquidity across the electricity value chain and restored investor confidence.

“Raising capital is the easier part; stewarding it with integrity is the harder and ongoing work,” he said.

The Series II bond is expected to be offered to investors ahead of a planned listing and is intended to remove a major barrier to investment and operational improvement in the power sector.

Government officials and transaction partners said the success of the issuance would serve as a test of Nigeria’s ability to use capital market solutions to resolve legacy liabilities and attract long-term private investment into the electricity industry.