Impact of Energy Consumption on Economic Growth in Nigeria: 1990 – 2023.

This research work examined the relationship that exist between energy consumption and economic growth in Nigeria for the period covering 1990- 2023 The paper examined the relationship between energy consumption and economic growth in Nigeria. Taking clue form the basics of this theory, a model was specified using Real Gross Domestic Product as a function of Gross Capital Formation, Labor Force, Per Capita Income, Electricity Consumption, Coal Consumption and Crude Oil Consumption. The study used energy consumption secondary data readily available from Central Bank of Nigeria Statistical Bulletin, the study conducted a unit root test to ascertain the stationary status of the data series, while co-integration technique was used to test for the relationship between the variables in the model. Finally, a linear regression analysis was conducted using error correction model (ECM) method. In light of the test and regression analysis conducted covering a study period of 25years (1990-20235), the following are the major findings. There is a positive and significant relationship between Real Gross Domestic Products and Gross Fixed Capital Formation, Labor Force, Per Capital Income, Electricity Consumption and Coal Consumption. While Crude Oil Consumption has a negative and non-significant relationship with Real Gross Domestic Products. Government should diversify energy consumption from fossil fuel to renewable one and alternative energy infrastructure should be enhanced through intentional investment.

Renewable Energy, Energy Consumption, RGDP, Coal Consumption Casualty, ECM

1. Adegbemi B. O., Adegbemi 0. 0., Olalekam A. J. and Babatunde 0. 0., (2013).Energy Consumption and Nigeria Economic Growth: An Empirical [Google Scholar] [Crossref]

2. Analysis. European Scientific Joumal,.February 2013 edition Vol. 9, No. 4 ISSN.T857 - 7881. [Google Scholar] [Crossref]

3. Adegbulugbe A. and Akinbami J. (2002). Policy Options for the Attainment of Sustainable Electricity Supply in Nigeria. Central Bank of Nigeria. [Google Scholar] [Crossref]

4. Adenikinju A. (2005). Analysis of the Coswt of Infrastructure Failure in a Development Economy: The case of the Electricity Sector in Nigeria. African Economic Research Consortium (AERC) Research Paper, 143, 112- 154. [Google Scholar] [Crossref]

5. Adetunji M. B. and Isa M. S. (2008). The Demand for Residential Electricity in Nigeria: A Bound Testing Approach [Google Scholar] [Crossref]

6. Adeyemi A. O. and Ayomide A. (2013). Electricity Consumption and Economic Growth in Nigeria. Journal of Business Management and Applied Economics, Vol. II, issue 4. [Google Scholar] [Crossref]

7. Afangideh U. J and Obiora I. K. (2004). Trade Policy and Manufacturing Exports in Nigeria: Performance, Challenges and Prospects. Paper presented during the 2004 annual conference of NES, August 24. [Google Scholar] [Crossref]

8. African Review of Business and Technology, (2014), Energy Sector to Power sub-Saharan Affican.www.afiricanreview.com [Google Scholar] [Crossref]

9. Aigbokan B. E. (1999). Evaluating investment on basic infrastructure in Nigeria. Proceedings of the eight annual conference of the zonal research units. Organized by Research Department, Central Bank of Nigeria, June 30. [Google Scholar] [Crossref]

10. Alam M. S. (2006). Economic Growth with Enerty. Retrieved on the '20th November. [Google Scholar] [Crossref]

11. Alayande B. and Ekone F. (2001). The macro economic effects of government expenditure, money, exchange consumption in Nigeria. Proceedings of Nigerian Economic Society (NES) Annual Conference, 5,231 -244. [Google Scholar] [Crossref]

12. Ali-Akpajiak S. E and Pyke M. T. (2003). Poverty in Nigeria. Abuja: Oxfam Publications. [Google Scholar] [Crossref]

13. Aminu M. M and Aminu M. F. (2015). Energy Consumption and Economic Growth in Nigeria: A Causality Analysis. Journal of Economics and Sustainable Development. Vol. 6 No. 13. [Google Scholar] [Crossref]

14. Aqeel A and Butt M. S. (2001). The Relationship between Energy Consumption and Economic Growth In Pakistan, Asia-Pac, Dev. J. 8(2): 101-109. [Google Scholar] [Crossref]

15. Archibong P. E. (1997). The staqaus of supporting infrastructural facilities and service for non-oil sector development. Central Bank of Nigeria Economic and Financial Reviews, 35(4), 92- 115. [Google Scholar] [Crossref]

16. Asafu-Adjaye J. (2000). “The relationship between energy consumption. Energy prices and economic growth: time series evidence from Asian developing countries: Energy Econ. 22. 615-625. [Google Scholar] [Crossref]

17. Asian Development Bank (ADb). (2006). Report of the energy efficiency initiative.httpi//developmentasia.org/Documents/Reports/Energy-Efficiency- Initiative/exesum.pdf. Accessed 26 April, 2012. [Google Scholar] [Crossref]

18. Atser G. (2008). World Bank’s report on investors infrastructure decay. Sunday Punch, May 10, 8. [Google Scholar] [Crossref]

19. Ayodele A. S. (1999). Illegitimate energy market activities in the Nigerian energy industry: “The case of electricity and petroleum products”. DPC working paper, 2 63-81. [Google Scholar] [Crossref]

20. Ayodele A. S. (2001). Improving and sustainaing power (electricity) supply for socio-economic development in Nigeria. Retrieved May 12, 2009 from www.cenbank.org/out/annual/ACZRU/2001. [Google Scholar] [Crossref]

21. Ajkinolif E. A. (2009). Electric Consumption and Economic growth in Nigeria: Evidence from Cointegration and Co-feature Analysis Journal of Policy Modeling 31(5), 6.81-693. [Google Scholar] [Crossref]

22. Ahmad N. Hayat M. F., Hamad N. and lugman M. (2012). Energy Consumption and Economic Growth: Evidence from Pakistan. Australian Journal of Business and Management Research. Vol. 2 No. 06 (09-14). [Google Scholar] [Crossref]

23. Ahrens F. (2012). “Economy Watch”, The Washington Post Online, 1980 http://www.washingtonpost.com/wp-siv/business/economy- watch/fireside-chats/(l 6 Feb 12). [Google Scholar] [Crossref]

24. Almay G. and Karagol E. (2005). Electricity Consumption and Economic Growth: Evidence for Turkey. Energy Economies 27(6), 859-856. [Google Scholar] [Crossref]

25. Asafu-Adjaye J. (2000). The Relationship Between Energy Consumption, Energy Prices and Economic Growth: Time Series Evidence from Asian Development Countries. Energy Economies 22(6) 615-625. [Google Scholar] [Crossref]

26. Birol F. (2007). World Energy Prospects and Challenges, Melbourne: Blackwell Publishing. [Google Scholar] [Crossref]

27. Bright O. and Machame H. (2011). Energy Consumption and Economic Growth in Nigeria. JORIND (9) 1, 2011. www.ajol.info/iournals/jorind. [Google Scholar] [Crossref]

28. Central Bank of Nigeria, (2000). The changing Structure of the Nigerian Economy and Implications for development. Lagos: Realms Communication Ltd. [Google Scholar] [Crossref]

29. Central Bank of Nigeria Statistical Bulleting (2015). Online version. [Google Scholar] [Crossref]

30. Ciarreta A and Zarraga A. (2007). Electricity Consumption and Growth: Evidence from Spain. Department of Economic Analysis II, University of the Basque Country, Lehendakari Agirre 83, Bibao 48015, Spain. [Google Scholar] [Crossref]

31. Dare-Ajayi D (2007). “Recent Trends and Patterns in Nigeria’s Industrial Development”, Afr. Dev. 32-139-155. [Google Scholar] [Crossref]

32. Decanio S. (1993). Barriers within firms to energy-efficient investments. Energy Policy. 21, 906-914. [Google Scholar] [Crossref]

33. Ekpo A. (2008). World Bank’s Report on Investors Infrastructure decay in Nigeria. Sunday Punch May 10, 8. [Google Scholar] [Crossref]

34. Ekpo, U. N. (2014) “Nigeria Industrial Policies and Industrial Sector Performance: Analytical Exploration”, IOSR Journal of Economics and Finance (IOSR- JEF) e-ISSN:2321-5933, p-ISSN:2321-5925.3(4):01- 1 lwww.iosrjoumals.org www.iosrjoumals.org [Google Scholar] [Crossref]

35. Energy Information Administration (2007). Country Analysis briefs: Nigeria. Retrieved on 12th November form www.eia.doe.gov. [Google Scholar] [Crossref]

36. Electric Power Sector reform implementation Committee (EPIC) (2004). National Electric Power Policy. Retrieved on 21st July, 2007. [Google Scholar] [Crossref]

37. European Environmental Agency. (2005). Climate Change and European low- carbon energy system, EEA Report No. 1/2005, ISBN: 92-9167-765-5. [Google Scholar] [Crossref]

38. Faris H. and Namat A. A. (2015). Sustainable Energy: The Missing MDG. OFID Quarterly, January, 2015. [Google Scholar] [Crossref]

39. Gbadamosi et al, R. A. Story of the Deregulation of the Nigerian Downstream Oil Sector, (Abuja; Petroleum Product Pricing Regulatory Agency, 2007) p, 143. [Google Scholar] [Crossref]

40. Gbadebo O. O. & Chinedu O. (2009). Does Energy Consumption Contribute to Economic Performance? Empirical Evidence from Nigeria. Journal of Economic and International Finance, Vol. 1(2), pp. 044-058. [Google Scholar] [Crossref]

41. Gosh S. (2002). Electricity Consumption and Economic Growth in Idia. Energy Policy 30(2), 125-129. [Google Scholar] [Crossref]

42. Golove W. H. and Eto J. H. (1996). Market Barriers to Energy Efficiency: A Critical Reappraisal of the rational for public policies to promote energy efficiency. Energy and Environment division, Lawrence Berkeley National Laboratory, University of California. Berkeley. Report No. LBL-38059, UC-1322, http://eetd.ibi.gov/ea/EMP/reports/ 38O59.pdf. Accessed 1 May 2012. [Google Scholar] [Crossref]

43. Gujarati D. B. & Sangeetha A. (2007) Basic Econometrics (4th ed). New Delhi: Tata McGraw-Hill [Google Scholar] [Crossref]

44. Hirschman A. 0. (1953). The Strategy of Economic Development. 1st Edition, New Haven. [Google Scholar] [Crossref]

45. Iledare, O. (2006). Natural gas based development in Nigeria. Abstract for the energy and development Panel, 31st IAEE International Conference, 45- 77. [Google Scholar] [Crossref]

46. International Energy Agency (IEA), (2006). World Energy Outlook, ISBN: 92- 64-10989-7. Paris, France. [Google Scholar] [Crossref]

47. International Energy Agency (IEA), (2012). Energy efficiency: Policies and Measured database. http://www.iea.org/textbase/pm/?mode=pm. Accessed 19 April 2012. [Google Scholar] [Crossref]

48. Iwayemi A. (1991). Infrastructure deficiencies and the Nigerian business environment: Basic issues and policy options, Proceedings of a one-day seminar organized by the Nigerian Economic Society, Ibadan, March 15. [Google Scholar] [Crossref]

49. Iwayemi A. (1998). Energy Sector Development in Africa: A background paper prepared for the African Development report, Sponsored by African Development Bank, July 30. [Google Scholar] [Crossref]

50. Iwayemi A. (2008). Investment in Electricity Generation and Transmission in Nigeria: Issues and Options. International Association for Energy Economics, Pp 137-421. [Google Scholar] [Crossref]

51. Jochem E. (2004). World Energy Assessment: Energy and the Challenges of Sustainability. Energy end-use efficiency pp. 174-217. [Google Scholar] [Crossref]

52. Johanseh S. and Juselius K. (1990). Maximum Likelihood Estimation and Inference on Co-integration with Applications to the Demand for Money. Oxford Bulletin of Economics and Statistics 52, 162-210. [Google Scholar] [Crossref]

53. Jollands N. Waide P., Ellis M., Onoda T., Lausten J., Tanak, K., et al (2010). The 25 IEA energy efficiency policy recommendations to the G8 Gleneagles plan of action. Energy policy, 38(11), 6409-6418. [Google Scholar] [Crossref]

54. Kessides C. (1993). The contributions of infrastructure to economic development: A review of experience and policy implications. World Bank Discussion papers, 213, 64 - 89. [Google Scholar] [Crossref]

55. Klessmann C., Graus W., Harmelink M., and Geurts, F. (2007). Making Energy-Efficiency Happen: From Potential to Reality: The road not taken? Foreign Affairs 55(1), 65-96. [Google Scholar] [Crossref]

56. Krizanic F. (2007). The European Market of Electricity and Natural Gas. EIB Forum, Ljubljana. [Google Scholar] [Crossref]

57. Kouakou K and Auguste, (2010). Economic Growth and Electricity Consumption in Cote d’Ivoire. Evidence from time series analysis. Energy, Policy. Science Director. [Google Scholar] [Crossref]

58. Kraft J and Kraft A. (1978). On the Relationship Between Energy and GDP. Journal of Energy and Development 3, 401-403. [Google Scholar] [Crossref]

59. Morimoto R. and Hope C. (2001). The Impact of Electricity Supply on Economic Growth in Sri Lanka. Judge Institute of Management Research Paper. National Bureau of Statistics. (2015). [Google Scholar] [Crossref]

60. Navroz K.D. (2004) Electric Power Reform: Social and Enviromnental Issues. Encyclopedia of Energy Vol 2. [Google Scholar] [Crossref]

61. Ndebbio J.E.U (2006). The structural economic dimensions of underdevelopment. Associated vicissitude and imperatives: Agenda for positive change. 33rd inaugural lecture. Calabar: Saesprint. [Google Scholar] [Crossref]

62. Nigerian National Committee of the World Energy Council (NNC-WAC) (2007). Communique on Africa forum on energy efficiency. 8 - 9th January. [Google Scholar] [Crossref]

63. Odell P.R. (1965). The demand for energy in a developing region. A case study of the upper anca valley in Columbia. Journal of Development Studies, 4, 115-138. [Google Scholar] [Crossref]

64. Oke O.A. (2006). Impact of energy on the manufacturing sector in Nigeria. Retrieved December 24, 2009 from http://www.fypower.org/ pdf/mfg NAM NASE.pdf. [Google Scholar] [Crossref]

65. Okonkwo W.L (2000). Attainment of sustainable electricity supply in nigeria: Photovoltaic option. Central Bank of Nigeria Bullion, 5, 13 - 20. [Google Scholar] [Crossref]

66. Okpanefe P.E and Owolabi, S. (2001). Small Hydropower in Nigeria. 2001 TCDC Training Workshop on SHP. [Google Scholar] [Crossref]

67. OPEC Fund for International Development (OFID) Quarterly Publication, January 2015. I? t*1 [Google Scholar] [Crossref]

68. Oviemuno A.O (2006). Impact of energy on the manufacturing sector of Nigeria. Retrieved on 01 November 2007 from www.searchwap.com. [Google Scholar] [Crossref]

69. Oyaromade R., Adagunodo M. and Bamidele P. (2014). Energy Consumption and Economic Growth in Nigeria: A Causality Analysis. International Journals of Sustainable Energy and Environmental Research, 2014 3(1): 53-61. [Google Scholar] [Crossref]

70. Quedraogo l.M. (2010). Electricity Consumption and Economic Growth in Burkina Faso: Aco-integration Analysis. Energy Economices 32 (3), 524-531. [Google Scholar] [Crossref]

71. Richard D.P). (2004). Early Industrial World Energy Flow in Encyclopedia of Energy Vol. 1. [Google Scholar] [Crossref]

72. Romer P.M (1986). Increasing returns and long run growth, the journal of political Economy, 98 (5), 1002-1037. [Google Scholar] [Crossref]

73. Romer P.M (1994). Endogenous technological change. The Journal of Political Economy, 98 (5), S71 - S102. [Google Scholar] [Crossref]

74. Sambd A.S. (2008). Electricity demand from customers of INGA hydropower projects: the case of Nigeria. Paper presented at the WEC workshop on financing INGA hydropower projects, Lagos, June 12. [Google Scholar] [Crossref]

75. Sanchis M.T. (2007). Quantifying the contribution of electricity to Spanish economic growth during the twentieth Century. Paper presented at the iii Iberometrics Valencia, March 23 - 24. [Google Scholar] [Crossref]

76. Shen L. (2006). Advancing more banks entering into the field of energy conservation by using new energy conservation mechanism. http://3countryee.org/paris/AgenderParisEEconf.pdf. Accessed 26 April 2012. [Google Scholar] [Crossref]

77. Simpson E.S (1969). Electricity production in Nigeria. Economic Geography. 45 (3): 239-257. [Google Scholar] [Crossref]

78. Solar Energy Research Institute (SERI) (1981). A new prosperity: Building a sustainable energy future. And over, MA: Brick House Publishing. [Google Scholar] [Crossref]

79. Steel W.F and Webster L.M (1991). Small enterprises under adjustment in Ghana. World Bank Technical Paper, 138, 62 - 83. [Google Scholar] [Crossref]

80. Stem N. (1991). The determinants of growth. Economic Journal, 101, 213 - 231. [Google Scholar] [Crossref]

81. Subair K. and Oke D. (2008). Privatization and trends of aggregate consumption of electricity in Nigeria: An empirical analysis. African Journal of Accounting, Economics, Finance and Banking Research, 3 (3), 18-26. [Google Scholar] [Crossref]

82. Ubi P. S. and Effiom L. (2013). The Dynamic Analysis of Electricity Supply and Economic Development: Lesson form Nigeria. Journal of Sustainable Society, Vol. 2, No. 1 7 < ~ [Google Scholar] [Crossref]

83. Uchendu O. A. (1993). Economic cost of electricity outages: Evidence from sample study of industrial and commercial Finns in the Lagos area of Nigeria. Central Bank of Nigeria Economic and Financial Review, 31(3), 21-87. [Google Scholar] [Crossref]

84. Udahand Enag B. (2010). Industrial Development, Electricity Crisis and Economic Perfonnance in Nigeria. European Journal of Economics, Finance and Administrative Sciences. 105-121. Retrived from: http://www.euroj’ouranls, com. [Google Scholar] [Crossref]

85. Ukpong I. I. (1973). The Economic Consequences of electric power failures. Nigerian Journal of Economic and Social Studies, 15(1), 53-74. [Google Scholar] [Crossref]

86. Ukpong I. I. (1976). An Analysis of causes of power shortage in Nigeria. Nigerian Journal of Economic and Social Studies, 18, 39 - 49. [Google Scholar] [Crossref]

87. United Nations, (1996). 1994 energy statistics yearbook, New York: United Nations. [Google Scholar] [Crossref]

88. United Nations - Energy Group, (2005). The Energy Challenge for Achieving the Millennium Development Goals (MDGs). Washington D.C. [Google Scholar] [Crossref]

89. United Nations - Human Development Index, (2011). Accessing Modem Energy Services - Fundamental to Human Development [Google Scholar] [Crossref]

90. UNDP, (2010). EU-UN joint workshop on climate change and development. http .7/ web. undp. org/eu/documents/ec-un m exico-p4.pdf. Accessed 16 May, 2012. [Google Scholar] [Crossref]

91. United Nations Foundation, (UNF), (2007). Realizing the potential of energy efficiency - targets, policies, and measures for G8 countries. Expert report of the United Nations Foundation, Washington, D. C. [Google Scholar] [Crossref]

92. LJNEP, (2002). Capacity building for Sustainable development; An overview of UNEP environmental capacity development initiatives. ISBN: 92-807- 2266-2. [Google Scholar] [Crossref]

93. Wesselink B. Harmasen R. and Eichhammer W. (2010). Energy Savings 2020: How to triple the impact of energy saving policies in Europe. http://roadmap2050.eu/attachments/files/lEnergySavings2020- Full Report.pdf.Accessed 16 May 2012. [Google Scholar] [Crossref]

94. Worlde-Rufael Y. (2009). Energy Consumption and Economic Growth: The Experience of African Countries revisited. Energy policy 34(10), 1106- 1114. [Google Scholar] [Crossref]

95. World Bank, (1993). World Development Report. Washington D. C: World Bank. [Google Scholar] [Crossref]

96. Yang H. Y. (2000). A note on the causal relationship between energy and GDP in Taiwan. Energy Economies 22(3), 309-317. [Google Scholar] [Crossref]

97. Yoo S. (2005). Electricity Consumption and Economic Growth: Evidence from Korea, Energy Policy 33(12), 1627-1632. [Google Scholar] [Crossref]

98. Yu E. and Choi J. (1985). The causal relationship between energy and GNP, an international comparison. J. Energy Development [Google Scholar] [Crossref]

• Impact of Foreign Direct Investment in India
• Issues Involved in Digitalisation Special Reference to Indian Tourism Growth
• Relationship Marketing and Customer Loyalty in the Fast-Moving Consumer Goods (FMCG) Industry in Nairobi County
• Financial Literacy or Financial Inclusion? Which is Which, What is What—To Achieve Uganda’s 10-Fold Economic Growth By 2040
• Harnessing Natural Gas for Economic Transformation: Overcoming the Regulatory and Infrastructural Bottlenecks in Nigeria