Energy Poverty and Economic Development in Nigeria

Abstract

This study empirically examined the effect of energy poverty on economic development in Nigeria from 1990 to 2024. Energy poverty was proxied by access to electricity, electricity tariff, access to clean fuels and technologies and renewable energy consumption, while economic development was measured by Human Development Index. In order to achieve the objectives of the study, annual time series data were sourced from the Central Bank of Nigeria Statistical Bulletin, World Development Indicators of the World Bank, National Bureau of Statistics reports, Africa Energy Portal and the International Energy Agency. The data obtained were tested for stationarity using the Augmented Dickey-Fuller approach, which revealed a mixed order of integration among the variables. Consequently, the ARDL bounds cointegration test was used to establish the existence of a long-run relationship among the variables, while the Autore-gressive Distributed Lag (ARDL) technique was employed to investigate the long-run and short-run parameters of the model. The results showed that access to electricity and renewable energy consumption have positive and significant effects on Human Development Index in Nigeria in both the short run and long run. Electricity tariff has a negative and significant effect on Human Development Index in both the short run and long run, while access to clean fuels and technologies has a positive but non-significant effect on Human Development Index in both the short run and long run. Based on the findings, the study concludes that energy poverty has a significant effect on economic development in Nigeria. The study re-commends that the Nigerian government should prioritize expanding access to reliable electricity supply through increased investment in power generation, transmission and distribution infrastructure, and that electricity tariff reforms should balance cost recovery with affordability for households and businesses.