ENERGY CONSUMPTION AND ECONOMIC GROWTH IN NIGERIA: AN ECONOMETRIC ASSESSMENT

ABSTRACT

This study provides an overview of energy consumption on economic growth in Nigeria using the aggregated and disaggregated approach. The objective of this research examined the impact of the aggregated model which is total energy consumption and disaggregated model, Electricity consumption, petroleum consumption, Gas consumption and Coal consumption on economic growth in Nigeria. This study used the annual time series secondary data sourced from the central bank of Nigeria annual statistical bulletin, annual abstract statistics from the national bureau of statistics and the energy information association data base which runs from the period of 1980 to 2018. This study adopted the auto regressive distributed lag model bound testing approach. The findings of this study showed no significant relationship between total energy consumption and economic growth in both the short run and long run. The disaggregated models showed that a long run relationship exist between disaggregated energy consumption variables and economic growth except gas consumption which was discovered to be statistically insignificant. However, all energy variables at the disaggregated level were positively related to economic growth in the long run of their respective models. Labour was statistically insignificant in the long run of all five models. Capital on the other hand was negatively signed and statistically significant in all five models except for coal consumption model. The study recommends that energy conservative policies should be reviewed and implemented and inefficiencies that currently limits the supply of energy resources has to be checked and resolved quickly to ensure that Nigeria enjoys the growth impact of abundant energy resources.