GenCos face Shutdown Over N6.8 trillion debt
Lagos, March 2026(TBL Africa) The country’s power generation companies has warned of an impending operational collapse driven by a staggering N6.8 trillion debt burden.
Dr Joy Ogaji, Chief Executive Officer of the GenCos and Executive Secretary of the Association of Power Generation Companies disclosed on Tuesday in Lagos.
Speaking on behalf of the industry, Ogaji painted a grim picture of a sector struggling to stay alive under financial suffocation.
“We have not shut down,” Ogaji clarified, “but units are gradually going offline, not only due to lack of gas, but because we can no longer maintain machines or even pay salaries.”
“Across the country, Nigerians continue to endure persistent blackouts as generation capacity weakens daily.
” Behind the scenes, operators are grappling with failing infrastructure, unpaid invoices, and an exodus of skilled workers abandoning the sector in search of more stable livelihoods.
According to Ogaji, the mounting debt has crippled GenCos’ ability to fund basic operations, from equipment maintenance to gas procurement.
“Most staff are seeking jobs outside the GenCos because we cannot afford to pay salaries. The huge debt overhang is the major reason,” she said.
At the heart of the crisis lies a complex web of financial obligations between GenCos and the Nigerian Bulk Electricity Trading Company (NBET).
Ogaji insists the N6.8 trillion figure reflects accumulated liabilities across multiple categories, including unpaid invoices for electricity generated since 2015, capacity payments, foreign exchange differentials, and interest charges.
She further cited costs tied to operational realities often overlooked in tariff structures, frequent plant start-ups and shutdowns, ancillary services such as spinning reserves, and the mandated Free Governor Mode of Operation (FGMO), which accelerates wear on already strained equipment without compensation.
“The last reconciliation with NBET was in March 2025. Since then, there has been no agreement on the actual figures owed,” Ogaji revealed.
“NBET claims it owes only a fraction of our invoices, but in a bilateral contract, one party cannot unilaterally alter agreed terms. We are calling for a transparent reconciliation.”
“Beyond financial disputes, the sector is also absorbing losses from underutilised plants caused by gas supply constraints and transmission bottlenecks, factors that leave expensive infrastructure stranded while demand for electricity remains high.
Despite the growing state, Ogaji maintained that solutions remain within reach—if decisive action is taken.
“The immediate solution is political will, with a renewed focus on the power sector,” she said. “Secondly, there must be strict adherence to the sanctity of contracts.”
For now, however, the warning signs are unmistakable. Generation units are faltering, expertise is draining away, and the financial strain continues to tighten.
“The machines are grinding to a halt,” Ogaji warned. “The government knows the implications.”
