Authors :
Prisca Ngozi Iwunze
Volume/Issue :
Volume 9 - 2024, Issue 12 - December
Google Scholar :
https://tinyurl.com/5dsx8v64
Scribd :
https://tinyurl.com/yc47trp4
DOI :
https://doi.org/10.5281/zenodo.14591298
Abstract :
The article examines the relationship between
economic growth and the use of renewable energy
through an empirical analysis conducted in Nigeria
between 1990 and 2020. Further research was done to
determine the direction of causation, which leans
towards independence, between Nigeria's economic
progress and its use of renewable energy. The paper
offers a bivariate linear regression model as an empirical
model to illustrate how using renewable energy affects
economic growth. Descriptive analysis showed the data
to be normally distributed and the econometric
technique which includes unit root test, linear bivariate
regression model, cusum test and pairwise Granger
causality test was used to establish the efficacy of the
study. Econometric evidence obtained from the survey
showed that renewable energy consumption has a
significant positive impact on economic growth. R
square gives 0.99 variations in gross domestic product
that is explained by renewable energy consumption and
the probability value of 0.0001 indicates the overall
significance of all independent variables in the model.
Cusum test of stability evidenced the stability of the
model and Durbin Watson statistic of 2.3 indicates the
absence of autocorrelation in the model. The government
must take a purposeful policy position to increase its
investment in renewable energy to lower the economy's
carbon footprint, as there is no statistically significant
correlation between the use of renewable energy and
economic growth.
Keywords :
Causality Test, Cusum Test, Economic Growth, Ktoe, Renewable Energy, Unit Root Test.
References :
- World Energy Assessment (2000). http://www.undp.org/seed/eap.activities/wea/ at 299-302.
- International Energy Agency (IEA) (2018). World Energy Outlook, (OECD: Paris)
International Energy Agency (IEA), (2017). World Energy Outlook 2017. OECD: Paris.
- Olugbenga, E. O. (2013). The politics of pharmaceutical regulation in Nigeria: Policy options for third world countries. Politics, 3(8), 89-100.
- Kenneth, H. (2014). Making the commitment to renewable energy. Global wind reports annual market update
- Payne, Phillip. (2010). The globally great moral challenge: Ecocentric democracy, values, morals and meaning. Environmental Education Research - ENVIRON EDUC RES. 16. 153-171. 10.1080/13504620903504115.
- Asian Development Outlook (2021). Financing a Green and Inclusive Recovery. (2021). https://doi.org/10.22617/fls210163-3
- Yépez-García, R. A., & Dana, J. (2012). Mitigating Vulnerability to High and Volatile Oil Prices. In The World Bank eBooks. https://doi.org/10.1596/978-0-8213-9577-6
- Okoye, L.U., Modebe, N.J., Erin, O.A., Evbuomwan, G.O. (2017). Effect of External Debt on Economic Growth: Evidence from Nigeria. Austria, Vienna: Proceedings of the 29th International Business
- Omri, A., Daly, S. & Nguyen, D., (2015). A robust analysis of the relationship between renewable
energy consumption and its main drivers, Applied Economics, 47(28): 2913-2923, DOI: 10.1080/00036846.2015.1011312 NNPC, (2010). Nigerian National Petroleum Corporation: Available at: www.nnpcgroup.com .
- Ben Jebli, Mehdi & Ben Youssef, Slim. (2017). Renewable energy, arable land, agriculture, CO2 emissions, and economic growth in Morocco. MPRA Paper.
- Maji, I., Sulaiman, C., & Rahim, A. (2019). Renewable energy consumption and economic growth nexus: Fresh evidence from West Africa. Energy Reports, Volume 5, March. DOI: 10.1016/j.egyr.2019.03.005
- Khan, M. K., Khan, M. I., & Rehan, M. (2020). The relationship between energy consumption, economic growth and carbon dioxide emissions in Pakistan. Financial Innovation, 6(1), 1. doi:https://doi.org/10.1186/s40854-019-0162-0
- Ibrahim Aminu, Mohammed. (2015). Mediating Role of Dynamic Capabilities on the Relationship between Intellectual Capital and Performance: A Hierarchical Component Model Perspective in PLS-SEM Path Modeling. Research Journal of Business Management. 9. 443-456. 10.3923/rjbm.2015.443.456.
- Doytch, Nadia & Narayan, Seema. (2021). Does Transitioning towards Renewable Energy Accelerate Economic Growth? An Analysis of Sectoral Growth for a Dynamic Panel of Countries. Energy. 235. 121290. 10.1016/j.energy.2021.121290.
- Acheampong EO, Sayer J, Macgregor CJ, Sloan S. (2021). Factors Influencing the Adoption of Agricultural Practices in Ghana’s Forest-Fringe Communities. Land; 10(3):266. https://doi.org/10.3390/land10030266
- Koengkan, M., Fuinhas, J. A., & Santiago, R. (2020). The relationship between CO2 emissions, renewable and non-renewable energy consumption, economic growth, and urbanisation in the Southern Common Market. Journal of Environmental Economics and Policy, 9(4), 383-401.
- Soytas, Ugur & Sari, Ramazan. (2003). Energy Consumption and GDP: Causality Relationship in G-7 Countries and Emerging Markets. Energy Economics. 25. 33-37. 10.1016/S0140-9883(02)00009-9.
- Ivanovski, Kris & Hailemariam, Abebe & Smyth, Russell. (2021). The effect of renewable and non-renewable energy consumption on economic growth: Non-parametric evidence. Journal of Cleaner Production. 286. Article 124956. 10.1016/j.jclepro.2020.124956.
- Zebra, E. I. C., van der Windt, H. J., Nhumaio, G. & Faaij, A. P.C. (2021). A Review of Hybrid Renewable Energy Systems in Mini-grids for off-grid Electrification in Developing Countries. Renewable and Sustainable Energy Reviews, 144 (1), 1 – 23. 111036,https://doi.org/10.1016/j.rser.2021.111036.
- Seetharaman, Krishna Moorthy, Nitin Patwa, Saravanan, and Yash Gupta. (2019). “Breaking Barriers in Deployment of Renewable Energy.” Heliyon 5 (1). https://doi.org/10.1016/j.heliyon.2019.e01166.
- Aliyu, U.O. and Elegba, S. B. (1990). Prospects for Small Hydropower Development for Rural
Applications in Nigeria. Nigerian Journal of Renewable Energy, 1, 74-86.
- Okafor E.N.C. and Joe-Uzuegbu (2010). Challenges to development of renewable energy for
electricity power sector in Nigeria. International journal of academic research, 2:2 211- 216
- Sambo, A. S. (2009). Strategic Developments in Renewable Energy in Nigeria. International
Association for Energy Economics. Third Quarter: 15 – 19.
- Uzoma, C. C.; Nnaji, C. E; Ibeto, C.N.; Okpara, C.G.; Nwoke, O.O.; Obi, I.O.; Unachukwu, G.
O and Oparaku, O. U. (2011). Renewable Energy Penetration in Nigeria: A Study of The South East Zone. Continental J. Environmental Sciences 5 (1): 1 - 5, ISSN: 2141 - 4084
http://www.wiloludiournal.com
- Nnaji, Chibueze & Uzoma, Chigasa & Chukwu, Jude. (2010). The Role of Renewable Energy Resources in Poverty Alleviation and Sustainable Development in Nigeria. Continental J. of Social Sciences. 3. 31-37.
- Akinbami, J.F.K. (2001). Renewable Energy Resources and Technologies in Nigeria: Present
Situation, Future Prospects and Policy Framework. Mitigation and Adaptation Strategies for Global Change 6: 155-188. Kluwer Academic Publishers. Netherlands.
The article examines the relationship between
economic growth and the use of renewable energy
through an empirical analysis conducted in Nigeria
between 1990 and 2020. Further research was done to
determine the direction of causation, which leans
towards independence, between Nigeria's economic
progress and its use of renewable energy. The paper
offers a bivariate linear regression model as an empirical
model to illustrate how using renewable energy affects
economic growth. Descriptive analysis showed the data
to be normally distributed and the econometric
technique which includes unit root test, linear bivariate
regression model, cusum test and pairwise Granger
causality test was used to establish the efficacy of the
study. Econometric evidence obtained from the survey
showed that renewable energy consumption has a
significant positive impact on economic growth. R
square gives 0.99 variations in gross domestic product
that is explained by renewable energy consumption and
the probability value of 0.0001 indicates the overall
significance of all independent variables in the model.
Cusum test of stability evidenced the stability of the
model and Durbin Watson statistic of 2.3 indicates the
absence of autocorrelation in the model. The government
must take a purposeful policy position to increase its
investment in renewable energy to lower the economy's
carbon footprint, as there is no statistically significant
correlation between the use of renewable energy and
economic growth.
Keywords :
Causality Test, Cusum Test, Economic Growth, Ktoe, Renewable Energy, Unit Root Test.