The Impact of Electricity Supply on the Manufacturing Sector in Nigeria (2000–2022)

Student: Naomi Okoh Usobo (Project, 2025)
Department of Economics
St. Albert The Great Major Seminary, Abeokuta. (affl. To University of Benin)

Abstract

This study aims at investigating the impact of electricity on manufacturing sector in Nigeria using annual time series data for the period 1985 to 2023. Augmented Dickey-fuller (ADF) test was used to test for the stationarity of the variables and they were found to be stationary at first difference. Then Johansen co-integration technique was used to establish if the stationary variables are co-integrated in the long run. Further, ECM is employed to correct any form of disequilibrium in the short run. The result of stationarity test reveals that the model is well specified and could be used for policy analysis. The result of the study revealed that all the three independent variables have a positive relationship with manufacturing sector productivity in both short and long run. Consumption of coal, crude oil and electricity are all statistically significant in the determination of manufacturing sector productivity in the long run. In conclusion, energy consumption is an important factor that determine the productivity on the manufacturing sector. The study later recommended that there should be proper funding and management of the energy sector of the country as it has a direct relationship on industrialization.

Keywords
electricity supply manufacturing sector Nigeria industrial growth energy policy power generation economic development productivity infrastructure industrialization
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