Africa Finance Corporation (AFC) has acted as Co-Financial Adviser on the successful issuance of the first tranche of bonds under Nigeria’s Presidential Power Sector Financial Reforms Programme, marking a major milestone in efforts to stabilize and reform the country’s electricity sector. The issuance, valued at ₦501 billion, forms part of a broader ₦4 trillion Power Sector Bond Programme aimed at resolving long-standing financial challenges in the Nigerian electricity supply industry.
The bond programme is designed to address more than a decade of accumulated legacy debt by settling verified receivables owed to power generation companies for electricity supplied between February 2015 and March 2025. Implemented through a special purpose vehicle under Nigerian Bulk Electricity Trading Plc, the initiative is overseen by the Presidential Power Sector Debt Reduction Committee with technical leadership from the Office of the Special Adviser to the President on Energy.
By clearing outstanding arrears and extinguishing legacy claims, the programme seeks to restore liquidity, strengthen the balance sheets of generation companies, and improve overall financial stability across the power sector. These measures are expected to enhance investor confidence and unlock new domestic and international investment across the electricity value chain.
The transaction attracted strong participation from Nigeria’s pension fund investment community, which provided around half of the total financing. This reflects growing confidence in the reform agenda and demonstrates the successful mobilization of domestic capital for critical power infrastructure development.
AFC’s role included advising on the programme’s negotiation framework, supporting settlement agreements with generation companies, and structuring the bond issuance in collaboration with CardinalStone Partners. The engagement highlights AFC’s expertise in delivering complex financial solutions that support large-scale sector reforms.
Once fully implemented, the programme is expected to impact approximately 5,398 megawatts of electricity generation capacity and finalize payment settlements for electricity supplied to millions of consumers since 2015. Combined with wider reforms in metering, transmission infrastructure, and market-based electricity trading, the initiative aims to lay the foundation for a sustainable and commercially viable electricity market to support Nigeria’s long-term economic and industrial growth.
