Impact of Energy Consumption from Renewable Energy Sources on Economic Growth: Evidence from Nigeria

Ebube Orisa; Anthony Ibe; Alwell Nteegah

doi:doi:10.11648/j.jenr.20241304.11

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Impact of Energy Consumption from Renewable Energy Sources on Economic Growth: Evidence from Nigeria

Ebube Orisa^*

, Anthony Ibe, Alwell Nteegah

Published in Journal of Energy and Natural Resources (Volume 13, Issue 4)

Received: 25 August 2024 Accepted: 18 September 2024 Published: 29 October 2024

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Abstract

This study examines the impact of renewable energy consumption and electricity tariff on the economy of Nigeria. The study considers the casual relationship and vector decomposition between various renewable energy sources (solar, hydro and biomass), electricity price and Gross domestic product (GDP) using an unrestricted vector error correction model (VECM). In addition, other robust econometric techniques were applied to the time series of GDP, electricity price and energy consumption from renewable energy sources from 1980 to 2021. The findings indicated a 1% increase in biomass consumption causes increase in GDP by 0.14% in the long-run. Mixed result in the short-run with the difference in the log value of the current lag of solar and bio electricity consumption having positive impact on GDP. The coefficient of the Error Correction Model (ECM) was negative (-0.49) and statistically significant indicating that short-run change from the long-run equilibrium is corrected by 49% annually. Unidirectional causality from GDP to solar electricity consumption. Solar, hydro, biomass and electricity price explain 1.4%, 0.4% 2.2% & 12% respectively of fluctuations in GDP in the long-run. The study results demonstrates that regulations need to be put in place to control the adverse effect of consuming biomass on the environment which could cause mixed impact on gross domestic product in the short run whereas, policies to foster development of solar projects could impact positively on GDP and alleviate the electricity supply deficiency in Nigeria.

Published in	Journal of Energy and Natural Resources (Volume 13, Issue 4)
DOI	10.11648/j.jenr.20241304.11
Page(s)	138-151
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2024. Published by Science Publishing Group

Keywords

Economic Growth, Renewable Energy, Electricity Consumption, Electricity Price, GDP, Econometrics

References

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APA Style

Orisa, E., Ibe, A., Nteegah, A. (2024). Impact of Energy Consumption from Renewable Energy Sources on Economic Growth: Evidence from Nigeria. Journal of Energy and Natural Resources, 13(4), 138-151. https://doi.org/10.11648/j.jenr.20241304.11

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ACS Style

Orisa, E.; Ibe, A.; Nteegah, A. Impact of Energy Consumption from Renewable Energy Sources on Economic Growth: Evidence from Nigeria. J. Energy Nat. Resour. 2024, 13(4), 138-151. doi: 10.11648/j.jenr.20241304.11

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AMA Style

Orisa E, Ibe A, Nteegah A. Impact of Energy Consumption from Renewable Energy Sources on Economic Growth: Evidence from Nigeria. J Energy Nat Resour. 2024;13(4):138-151. doi: 10.11648/j.jenr.20241304.11

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@article{10.11648/j.jenr.20241304.11,
  author = {Ebube Orisa and Anthony Ibe and Alwell Nteegah},
  title = {Impact of Energy Consumption from Renewable Energy Sources on Economic Growth: Evidence from Nigeria
},
  journal = {Journal of Energy and Natural Resources},
  volume = {13},
  number = {4},
  pages = {138-151},
  doi = {10.11648/j.jenr.20241304.11},
  url = {https://doi.org/10.11648/j.jenr.20241304.11},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.jenr.20241304.11},
  abstract = {This study examines the impact of renewable energy consumption and electricity tariff on the economy of Nigeria. The study considers the casual relationship and vector decomposition between various renewable energy sources (solar, hydro and biomass), electricity price and Gross domestic product (GDP) using an unrestricted vector error correction model (VECM). In addition, other robust econometric techniques were applied to the time series of GDP, electricity price and energy consumption from renewable energy sources from 1980 to 2021. The findings indicated a 1% increase in biomass consumption causes increase in GDP by 0.14% in the long-run. Mixed result in the short-run with the difference in the log value of the current lag of solar and bio electricity consumption having positive impact on GDP. The coefficient of the Error Correction Model (ECM) was negative (-0.49) and statistically significant indicating that short-run change from the long-run equilibrium is corrected by 49% annually. Unidirectional causality from GDP to solar electricity consumption. Solar, hydro, biomass and electricity price explain 1.4%, 0.4% 2.2% & 12% respectively of fluctuations in GDP in the long-run. The study results demonstrates that regulations need to be put in place to control the adverse effect of consuming biomass on the environment which could cause mixed impact on gross domestic product in the short run whereas, policies to foster development of solar projects could impact positively on GDP and alleviate the electricity supply deficiency in Nigeria.},
 year = {2024}
}

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TY  - JOUR
T1  - Impact of Energy Consumption from Renewable Energy Sources on Economic Growth: Evidence from Nigeria

AU  - Ebube Orisa
AU  - Anthony Ibe
AU  - Alwell Nteegah
Y1  - 2024/10/29
PY  - 2024
N1  - https://doi.org/10.11648/j.jenr.20241304.11
DO  - 10.11648/j.jenr.20241304.11
T2  - Journal of Energy and Natural Resources
JF  - Journal of Energy and Natural Resources
JO  - Journal of Energy and Natural Resources
SP  - 138
EP  - 151
PB  - Science Publishing Group
SN  - 2330-7404
UR  - https://doi.org/10.11648/j.jenr.20241304.11
AB  - This study examines the impact of renewable energy consumption and electricity tariff on the economy of Nigeria. The study considers the casual relationship and vector decomposition between various renewable energy sources (solar, hydro and biomass), electricity price and Gross domestic product (GDP) using an unrestricted vector error correction model (VECM). In addition, other robust econometric techniques were applied to the time series of GDP, electricity price and energy consumption from renewable energy sources from 1980 to 2021. The findings indicated a 1% increase in biomass consumption causes increase in GDP by 0.14% in the long-run. Mixed result in the short-run with the difference in the log value of the current lag of solar and bio electricity consumption having positive impact on GDP. The coefficient of the Error Correction Model (ECM) was negative (-0.49) and statistically significant indicating that short-run change from the long-run equilibrium is corrected by 49% annually. Unidirectional causality from GDP to solar electricity consumption. Solar, hydro, biomass and electricity price explain 1.4%, 0.4% 2.2% & 12% respectively of fluctuations in GDP in the long-run. The study results demonstrates that regulations need to be put in place to control the adverse effect of consuming biomass on the environment which could cause mixed impact on gross domestic product in the short run whereas, policies to foster development of solar projects could impact positively on GDP and alleviate the electricity supply deficiency in Nigeria.
VL  - 13
IS  - 4
ER  -

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Author Information

Ebube Orisa

Emerald Energy Institute, University of Port Harcourt, Choba, Nigeria

Contact Email

http://orcid.org/0000-0001-9207-5680
Anthony Ibe

Department of Electrical/Electronic Engineering, University of Port Harcourt, Choba, Nigeria

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Alwell Nteegah

Department of Economics, University of Port Harcourt, Choba, Nigeria

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Plain Text BibTeX RIS

APA Style

Orisa, E., Ibe, A., Nteegah, A. (2024). Impact of Energy Consumption from Renewable Energy Sources on Economic Growth: Evidence from Nigeria. Journal of Energy and Natural Resources, 13(4), 138-151. https://doi.org/10.11648/j.jenr.20241304.11

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ACS Style

Orisa, E.; Ibe, A.; Nteegah, A. Impact of Energy Consumption from Renewable Energy Sources on Economic Growth: Evidence from Nigeria. J. Energy Nat. Resour. 2024, 13(4), 138-151. doi: 10.11648/j.jenr.20241304.11

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AMA Style

Orisa E, Ibe A, Nteegah A. Impact of Energy Consumption from Renewable Energy Sources on Economic Growth: Evidence from Nigeria. J Energy Nat Resour. 2024;13(4):138-151. doi: 10.11648/j.jenr.20241304.11

Copy | Download

@article{10.11648/j.jenr.20241304.11,
  author = {Ebube Orisa and Anthony Ibe and Alwell Nteegah},
  title = {Impact of Energy Consumption from Renewable Energy Sources on Economic Growth: Evidence from Nigeria
},
  journal = {Journal of Energy and Natural Resources},
  volume = {13},
  number = {4},
  pages = {138-151},
  doi = {10.11648/j.jenr.20241304.11},
  url = {https://doi.org/10.11648/j.jenr.20241304.11},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.jenr.20241304.11},
  abstract = {This study examines the impact of renewable energy consumption and electricity tariff on the economy of Nigeria. The study considers the casual relationship and vector decomposition between various renewable energy sources (solar, hydro and biomass), electricity price and Gross domestic product (GDP) using an unrestricted vector error correction model (VECM). In addition, other robust econometric techniques were applied to the time series of GDP, electricity price and energy consumption from renewable energy sources from 1980 to 2021. The findings indicated a 1% increase in biomass consumption causes increase in GDP by 0.14% in the long-run. Mixed result in the short-run with the difference in the log value of the current lag of solar and bio electricity consumption having positive impact on GDP. The coefficient of the Error Correction Model (ECM) was negative (-0.49) and statistically significant indicating that short-run change from the long-run equilibrium is corrected by 49% annually. Unidirectional causality from GDP to solar electricity consumption. Solar, hydro, biomass and electricity price explain 1.4%, 0.4% 2.2% & 12% respectively of fluctuations in GDP in the long-run. The study results demonstrates that regulations need to be put in place to control the adverse effect of consuming biomass on the environment which could cause mixed impact on gross domestic product in the short run whereas, policies to foster development of solar projects could impact positively on GDP and alleviate the electricity supply deficiency in Nigeria.},
 year = {2024}
}

Copy | Download

TY  - JOUR
T1  - Impact of Energy Consumption from Renewable Energy Sources on Economic Growth: Evidence from Nigeria

AU  - Ebube Orisa
AU  - Anthony Ibe
AU  - Alwell Nteegah
Y1  - 2024/10/29
PY  - 2024
N1  - https://doi.org/10.11648/j.jenr.20241304.11
DO  - 10.11648/j.jenr.20241304.11
T2  - Journal of Energy and Natural Resources
JF  - Journal of Energy and Natural Resources
JO  - Journal of Energy and Natural Resources
SP  - 138
EP  - 151
PB  - Science Publishing Group
SN  - 2330-7404
UR  - https://doi.org/10.11648/j.jenr.20241304.11
AB  - This study examines the impact of renewable energy consumption and electricity tariff on the economy of Nigeria. The study considers the casual relationship and vector decomposition between various renewable energy sources (solar, hydro and biomass), electricity price and Gross domestic product (GDP) using an unrestricted vector error correction model (VECM). In addition, other robust econometric techniques were applied to the time series of GDP, electricity price and energy consumption from renewable energy sources from 1980 to 2021. The findings indicated a 1% increase in biomass consumption causes increase in GDP by 0.14% in the long-run. Mixed result in the short-run with the difference in the log value of the current lag of solar and bio electricity consumption having positive impact on GDP. The coefficient of the Error Correction Model (ECM) was negative (-0.49) and statistically significant indicating that short-run change from the long-run equilibrium is corrected by 49% annually. Unidirectional causality from GDP to solar electricity consumption. Solar, hydro, biomass and electricity price explain 1.4%, 0.4% 2.2% & 12% respectively of fluctuations in GDP in the long-run. The study results demonstrates that regulations need to be put in place to control the adverse effect of consuming biomass on the environment which could cause mixed impact on gross domestic product in the short run whereas, policies to foster development of solar projects could impact positively on GDP and alleviate the electricity supply deficiency in Nigeria.
VL  - 13
IS  - 4
ER  -

Copy | Download