Gencos Settle Only 39% of Invoices Amid N1.85tn Subsidies

In 2025, Nigerian power generation companies (Gencos) faced significant financial challenges, with only 39.25% of their invoices settled, amounting to N1.24 trillion out of N3.16 trillion issued. The Nigerian Electricity Regulatory Commission (NERC) reported that unfunded government subsidies ballooned to N1.85 trillion, highlighting a persistent structural gap in the electricity supply industry.

The federal government owes Gencos N1.92 trillion, contributing to a cash flow crisis. The government has frozen electricity tariffs for certain consumer categories to cushion the impact of rising power costs.

Despite some improvements in remittances from distribution companies (Discos), which achieved a 93.80% compliance rate, the overall settlement level remains low due to the absence of subsidy payments. By the end of 2025, outstanding subsidy debt is expected to reach N1.85 trillion, intensifying financial strain across the sector.

The federal government has floated a bond of N500 billion to offset part of this debt.