Real Growth Impact of Energy Use In Nigeria: An Empirical Analysis 2010-2024
Abstract
This study examined the empirical analysis of the growth impact of energy consumption in Nigeria. The information for the data was collected from the 2023 CBN statistical bulletin, Enerdata, and the WDI database, covering the period from 2010 to 2024. Economic growth served as the dependent variable, while electricity energy consumption, petroleum energy consumption, and natural gas energy consumption were the explanatory variables. The study reveals several key findings: there is an insignificant and Adverse relationship between electricity energy usage and in Nigeria economic development. In contrast, both petroleum and natural gas energy consumption show significant and positive relationships with economic growth. Furthermore, the analysis revealed a long-term connection between energy utilization and economic growth. In light of these results, the study suggests that the Nigerian government prioritize domestic refining and value chain integration by accelerating the rehabilitation of government-owned refineries. It also suggests providing targeted support, such as tax and import waivers for equipment, to private modular and large-scale refinery projects. A core priority is to reestablish the connection between energy used and economic output, ensuring that electricity becomes a reliable and productive factor of production. To achieve this, the government should implement urgent, ring-fenced targeted capital initiatives to reduce technical, commercial, and collection losses, particularly in the distribution segment. This will stabilize the grid, increase supply reliability, and ensure that generated power reaches end-users efficiently. Furthermore, the the positive accelerating the completion of essential domestic gas pipeline projects, including the Ajaokuta-Kaduna-Kano (AKK) pipeline. long-term effects of consuming natural gas for energy should be leveraged to drive sustainable industrial growth and fuel the power sector transition, particularly by expediting the completion of critical domestic gas pipeline projects, such as the Ajaokuta-Kaduna-Kano (AKK) pipeline, to Guarantee a sufficient, dependable, and cost-effective gas supply to existing and planned power generation facilities. Further research is advised for updated policy recommendations.
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