ENERGY CONSUMPTION AND ECONOMIC GROWTH IN NIGERIA

ABSTRACT

This study explored the relationship between the energy consumption and economic growth in Nigeria. Specifically; to explored the effect of energy poverty on economic growth in Nigeria; and to find out if there is significant causal relationship between energy consumption, energy poverty and economic growth in Nigeria, using annual data from 1986 to 2017. Augmented Dickey Fuller (ADF) unit root test, the maximum lag selection criteria for the ARDL Bounds Cointegration test, Toda and Yomamoto Granger Causality Test and the stability and diagnostic test were employed. The research revealed that the energy consumption has positive significant impact on the economic growth in Nigeria. Also energy poverty significantly affected the economic growth in Nigeria. Finally, the finding indicates that there is unidirectional significant causal relationship between the electric power consumption, access to electricity (proxy for energy poverty) and economic growth in Nigeria. Based on the research findings, the study therefore recommends that, there is need for policy makers to boost investment in the energy sector in order to increase its supply, and meeting the demand for energy with a view to meeting the expectations of the millennium development goals.