Impact of electricity consumption on economic growth in Nigeria: An approach of time series econometrics

Electricity is a vital form of energy and therefore electricity supply security is crucial to ensure the continued supply of electricity from a well-functioning industrial process. The broad objective of this study is to analyze the impact of electricity consumption in Nigeria economy. The specific objectives are to: (i) evaluate the impact of state street-light electricity consumption on economic growth in Nigeria, (ii) ascertain the impact of residential electricity consumption on economic growth in Nigeria, (iii) determine the impact of commercial electricity consumption on economic growth in Nigeria. The electricity consumption variables consist of commercial electricity consumption (CEC), state street-light electricity consumption (SLEC), Residential electricity consumption (REC) and Real Gross Domestic Product (RGDP). All the variables were sourced from Central Bank of Nigeria’s (CBN) statistical bulletin for various years. The data collected was estimated with multiple Least Square Regression. The study employed statistical package for social science (SPSS) statistical application software to analysis the data. The findings of the study revealed that commercial electricity consumption (CEC) has positive significant impact on economic growth in Nigeria (t – statistics (7.935354) > t0.05 (1.684). State street-light electricity consumption (SLEC) has positive significant impact on economic growth in Nigeria (t – statistics (3.547276) > t0.05 ((1.684). It also revealed that residential electricity consumption (REC) has positive significant impact on economic growth in Nigeria (t – statistics (0.867141) < t0.05 ((1.684). Based on the findings of the study recommended that the Citizens of Nigeria should be educated to use the limited electricity supply wisely. It suggests that the policy of conserving energy consumption may be implemented with little or no adverse effect on economic growth, such as in a less energy-dependent economy.