Dr. Joy Ogaji, CEO of the Association of Power Generation Companies (GENCOs), has warned that the Federal Government’s N501 billion power sector bond is inadequate to address the mounting legacy debt owed to electricity generation companies.

Speaking on Arise Television on Thursday, Ogaji said Nigeria’s power sector debt, which stood at N4 trillion in December 2024, is now projected to reach about N6.6 trillion by the end of February 2026.

She explained that the debt has been rising by roughly N200 billion each month, exacerbating liquidity challenges within the sector.

“As of December 2024, it was N4 trillion. If you calculate N200 billion times 12, you know the figure for 2025. Now we are in February, so currently it’s above N6 trillion. We’re looking at about N6.6 trillion by month-end,” Ogaji said.

The GENCOs chief warned that the escalating debt could push Nigeria’s power sector toward collapse and worsen the country’s electricity crisis if urgent intervention is not taken.

Ogaji noted that President Bola Ahmed Tinubu had previously pledged to clear the N4 trillion legacy debt, but this promise was reduced to the N501 billion bond.

The federal government launched the N501 billion bond program in January 2026, which reportedly achieved full subscription.

Despite the privatization of Nigeria’s generation and distribution segments, the country continues to face power shortages. Although Nigeria has an installed capacity of about 15,000 megawatts, actual generation fluctuates between 2,000 and 4,000 megawatts, leaving millions of households and businesses with unreliable electricity.

Ogaji called on the government to implement a permanent, practical, and sustainable solution to clear the legacy debt and stabilize the sector.

She emphasized that without decisive action, the growing indebtedness will continue to hinder electricity supply and undermine investor confidence in the power industry.