Energy Crisis Looms as Gas Firms Cut Supply Over N5.6tn Debt
By NaijaEnquirer Staff
Nigeria faces a looming nationwide blackout as gas suppliers reduce deliveries to power plants over an outstanding N5.6 trillion debt owed to power generation companies (GenCos).
The Managing Director of the Association of Power Generation Companies (APGC), Dr. Joy Ogaji, confirmed the situation in an interview, warning that if not urgently addressed, the country could sink deeper into darkness.
Mounting Debt and Sector Strain
Ogaji disclosed that from January to August 2025, an additional N1.6tn debt was accumulated, raising the total to N5.6tn. She explained that 60% of GenCos’ revenue goes to gas producers, meaning debt directly undermines fuel supply for power generation. “Gas suppliers have already started reducing supply,” she said, noting that GenCos are struggling with machine maintenance, spare parts procurement, and obligations to creditors.
She added that GenCos issue monthly invoices of about N270bn, but only N70bn is paid, leaving a monthly shortfall of N200bn. The N900bn budgeted for the sector in 2025 without cash backing, she argued, is inadequate to address the crisis.
Government Engagement and Uncertainty
President Bola Tinubu had met with GenCos in July, approving in principle a N4tn bond programme to settle debts. However, Ogaji lamented that “almost two months after that meeting, there has been no follow-up engagement.” She also faulted government’s plan to issue promissory notes, citing concerns over interest rates, FX volatility, credit risks, and lack of market liquidity.
“GenCos remain patriotic investors, but patriotism alone cannot run power plants. Without urgent action, Nigeria risks prolonged blackouts,” she warned.
National Grid Fragility
The warning comes days after a grid collapse plunged the country into darkness. Although about 4,000MW has since been restored, several plants remain below capacity, underscoring the fragility of the electricity system.
Efforts to get a reaction from the Minister of Power, Adebayo Adelabu, were unsuccessful as his spokesman did not respond to calls. Meanwhile, the Transmission Company of Nigeria confirmed partial grid recovery.
Industry stakeholders have cautioned that unless the Federal Government urgently resolves the liquidity crisis, the sector could face deeper collapse, with devastating consequences for households, businesses, and the broader economy.
