The Senate has queried the Nigerian Bulk Electricity Trading Plc (NBET) over the mounting debt in the power sector, which has now climbed to about ₦3 trillion.
NBET’s Acting Managing Director and Chief Executive Officer, Johnson Akinnawo, disclosed this on Thursday when he appeared before the Senate Committee on Finance to defend the agency’s 2025 budget performance.
Akinnawo told the committee that outstanding liabilities across the electricity value chain spanning generation, transmission and distribution currently stand in the region of ₦3 trillion.
He attributed the situation to a persistent structural gap between the actual cost of electricity generation, transmission and distribution, and the amount recovered from consumers through tariffs.
“There remains a gap between the cost of generation, transmission and distribution of electricity and what is being recovered,” he said.
Chairman of the Committee, Senator Mohammed Musa, expressed concern that despite what appeared to be healthy market receipts on paper, the sector remained financially unstable.
“In your page three, market receipts look good. We understand this is a transitional arrangement, but if performance is strong, the market should be sustainable,” Musa said.
Akinnawo, however, explained that although ₦858 billion was appropriated for NBET in the 2025 fiscal year, only ₦60 million was released, and that came late in the year.
“At the close of the year, only ₦60 million was released toward the end of the year. Unfortunately, that affected our budget performance,” he said.
He added that the initial ₦858 billion proposal was later reduced to ₦601 billion, while the ₦60 million released was tied to a ₦200 million project that could not be implemented piecemeal due to procurement regulations
Senator Abdul Ningi raised concerns over intervention spending, noting that nearly 60 per cent of NBET’s appropriations were earmarked for interventions.
Responding, Akinnawo said distribution companies (DisCos) remit their collections to NBET, which then pays generation companies (GenCos) on a pro-rata basis.
“Every GenCo is paid on a pro-rata basis from whatever collections come from the DisCos. Azura is paid like every other GenCo,” he stated.
He noted that payment levels are constrained by low remittances and funding shortfalls, while the Federal Government, through the Ministry of Finance, bridges gaps arising from partial risk guarantees.
The NBET boss also highlighted the impact of foreign exchange exposure on the sector, explaining that generation tariffs are largely dollar-indexed, thereby increasing cost pressures amid currency volatility.
Akinnawo disclosed that a presidential power sector debt reduction committee, chaired by Minister of Finance Wale Edun, is currently reconciling the debt profile.
“As of now, the debt is in the region of ₦3 trillion,” he reiterated.
The committee subsequently directed NBET to provide a detailed breakdown of its revenues and expenditures to enable proper legislative assessment and oversight.
The development underscores ongoing structural and funding challenges in Nigeria’s electricity market, despite repeated interventions by the Federal Government to stabilise the sector.
