Senate committee expresses concerns over N800bn debt in power sector

The Senate Committee on Power has expressed deep concern over the worsening liquidity crisis plaguing Nigeria’s power sector.

Reports show that the government currently owes electricity generating companies (GenCos) approximately N200 billion monthly due to tariff shortfalls, a debt that has now accumulated to N800 billion in 2025.

Chairman of the Committee, Senator Enyinnaya Abaribe, made this known during a media briefing at a retreat in Ikot-Ekpene, Akwa Ibom State, on Saturday.

The retreat, organised by the Nigerian Electricity Regulatory Commission (NERC), aimed to address critical and emerging challenges in the sector.

Abaribe lamented that no payments have been made to GenCos this year, compounding the sector’s existing debt burden of over N3 trillion.

He also highlighted the ripple effect on gas suppliers, who remain unpaid and cannot continue supplying gas indefinitely.

“There’s a major liquidity crisis. GenCos and DisCos are owed significant sums. Monthly, the government accumulates a debt of N200bn, and for 2025, no payments have been made, already putting us N800bn in the red,” he said.

Despite the grim figures, Abaribe expressed optimism that collaborative action from federal and state governments could turn the tide. He emphasized the urgent need for decisive policymaking around subsidies and payments to sustain electricity production.

“Other countries make tough choices, subsidising petrol or power. It’s time we decide what’s best for us,” he added.

Speaking at the retreat, Minister of Power Adebayo Adelabu noted progress in power generation under President Bola Tinubu’s administration but acknowledged persistent challenges such as funding shortages and widespread vandalism of energy infrastructure.

Governor Umo Eno of Akwa Ibom, represented by Deputy Governor Senator Akon Eyakenyi, highlighted the importance of consistent electricity for the growth of Small and Medium Enterprises (SMEs). He expressed confidence that the retreat’s deliberations would help address the sector’s critical issues.