Relative Impact of Energy Source on Nigeria’s Economic Growth

This study examines the relative impact of energy sources on Nigeria’s economic growth from 1984 to 2024. The research was informed by the low economic growth in the country. It considers the roles of fossil fuel consumption, hydroelectricity consumption, and biomass energy use as the determinants of economic growth in Nigeria. The study employs Autoregressive Distributed Lag (ARDL) and bounds testing co-integrationapproachto empirically examine therelationship between the energy sources and economic growth, using data obtained from World Development Indicators.The result of the analysis indicates the presence of a significant co-integrating (long-run) relationship among economic growth, fossil fuel consumption, hydroelectricity consumption, and biomass energy use. The resultestablished that fossil fuel consumption, hydroelectricity consumption and biomass energy use are statistically significant. However, while fossil fuel consumption and biomass energy use positively impact economic growth, hydroelectricity consumption hurt it in the long run. However, in the short run, hydroelectricity consumption and biomass energy use hurts economic growth. While hydroelectricity consumption is significant, biomass energy use is not. Similarly, fossil fuel consumption is positive but not significant on economic growth in the short run. Based on the findings, the government should invest in hydroelectric power, encourage modern technologies of biomass energy conversion and develop cleaner energy sources to reduce overdependence on fossil fuel and increase the energy mix in the country.