Effect of Energy Consumption on Economic Growth in Nigeria (1981-2023)

This study examines the impact of energy consumption on economic growth in Nigeria provides critical insights into the complex dynamics between energy usage and economic performance over the period from 1981 to 2023. The study reveals that while fossil fuel consumption positively correlates with Gross Domestic Product (GDP), increased reliance on renewable energy sources has led to a significant decline in GDP. This finding challenges the common perception that renewable energy is inherently beneficial for economic growth, suggesting that the current economic structure in Nigeria may not be conducive to maximizing the benefits of renewable energy at this stage. Furthermore, the study emphasizes the importance of understanding the causal relationships between different types of energy consumption and economic growth. The Granger causality tests indicate that there is no significant predictive relationship between renewable energy consumption and GDP changes, which implies that policymakers must reconsider their strategies regarding energy investments. The findings highlight a pressing need for a balanced approach that recognizes the immediate economic benefits of fossil fuels while simultaneously planning for a sustainable transition to renewable energy sources. Based on the findings several key recommendations made to enhance economic performance while addressing sustainability concerns Keywords: ARDL; Fossil Fuel Consumption; Gross Domestic Product (GDP)