Submit your papersSubmit Now
For Enquiries: [email protected]
IIARD LogoIIARD

Impact of Renewable Energy Consumption, Forest Area, and Economic Growth on CO? Emissions in Nigeria

V O Aninwagu PhD, Dr E Nyeche

Abstract

This study investigated the impact of renewable energy consumption, forest area, and economic growth on co? emissions in Nigeria, using renewable energy consumption (REC), forest area as a percentage of land area (FOA), and GDP per capita (GDPC) as independent variables, while CO2 emissions served as the dependent variable. Time series data for these variables were sourced from the World Development Indicators (WDI) for the period 1990 to 2023. Analytical methods employed include unit root tests, Engle-Granger cointegration, Error Correction Model analysis, and residual diagnostic tests. The Augmented Dickey-Fuller (ADF) unit root test results indicate that all variables were integrated of order one, I(1). The ECM results established a statistically significant and negative relationship between REC and CO? emissions; Furthermore, the analysis revealed a positive but statistically not significant relationship between FOA and CO? emissions. Additionally, GDP per capita showed a positive but statistically not significant effect on CO? emissions. Based on these findings, the study recommended among others that policymakers should implement targeted subsidies for renewable energy technologies, offer regulatory incentives to clean energy producers, and invest in infrastructure supporting decentralized renewable systems, particularly solar and biomass that align with Nigeria’s climatic and economic conditions.

Keywords

Engle-GrangerCO2 emissionGDP per capitaRenewable Energy consumptionand

References

Akpan, U., & Chuku, A. (2011). Economic growth and environmental degradation in Nigeria: Beyond the Environmental Kuznets Curve. Research Papers in Economics. Retrieved from https://mpra.ub.uni-muenchen.de/31241/ Asumadu-Sarkodie, S., & Owusu, P. A. (2016). Carbon dioxide emissions, GDP per capita, industrialization and population: An evidence from Rwanda. https://doi.org/10.4491/EER.2016.097 Avwioroko, A. (2023). The potential, barriers. And strategies to upscale renewable energyadoption in developing countries: Nigeria as a case study.https://doi.org/10.51594/estj.v4i2.1288 Awodumi, O. B., & Adewuyi, A. O. (2020). The role of non-renewable energy consumption in economic growth and carbon emission: Evidence from oil producing economies in Africa. Energy Strategy Reviews, 27, 100434. Aziz, G., & Mighri, Z. (2022). Carbon dioxide emissions and forestry in China: A spatial panel data approach. Sustainability, 14, 12862. https://doi.org/10.3390/ su141912862 Brownson, K., Anderson, E.P., Ferreira, S., Wenger, S.J., Fowler, L.A., & German, L. (2020). governance of payments for ecosystem ecosystem services influences social and environmental outcomes in Costa Rica. Ecological Economics, 174, 106659. https://doi.org/10.1016/j.ecolecon.2020.106659 Brundtland G. H. (1987) Our common future: Report of the World Commission on Environment and Development. Geneva, UN-Dokument A/42/427.Retrieved from http://www.un- documents.net/ocf-ov.htm Chen, C., Park, T., Wang, X., Piao, S., Xu, B., Chaturvedi, R., Fuchs, R., Brovkin, V., Ciais, P. ,Fensholt, R., Tømmervik, H., Bala, G., Zhu, Z., Nemani, R., & Myneni, R. (2019). China and India lead in greening of the world through land-use management.https://doi.org/10.1038/s41893- 019-0220-7 Chen, X., Liu, C., & Yu, X. (2022). Urbanization, economic development, and ecological environment: Evidence from provincial panel data in China. https://doi.org/10.3390/su14031124 Cole, M. A. (2004). Trade, the pollution haven hypothesis and the environmental Kuznets curve: examining the linkages. Ecological Economics, 48(1), 71–81. https://doi.org/10.1016/j.ecolecon.2003.09.007 Copeland, B. R., & Taylor, M. S. (1994). North-south trade and the environment. Quarterly Journal of Economics, 109(3), 755–787. https://doi.org/10.2307/2118421 Dinda, S. (2004). Environmental Kuznets curve hypothesis: A survey. Ecological Economics, 49(4), 431 https://doi.org/10.1016/j.ecolecon.2004.02.011 Fagge, A. M., Jakada, A., Yola, A. T., Marmara, A. D., & Abdu, M. (2023). Renewable energy and the state of environmental quality in Nigeria. https://doi.org/10.57233/gujeds.v3i1.15 Grossman, G. M., & Krueger, A. B. (1991). Environmental impacts of a North American Free Trade Agreement. National Bureau of Economic Research Working Paper No. 3914. https://doi.org/10.3386/w3914 Huang, Y., Kuldasheva, Z., & Salahodjaev, R. (2021). Renewable Energy and CO2 Emissions: Empirical evidence from major energy consuming countries. https://doi.org/10.3390/en14227504 Ihugba, O. A., Okonkwo, O., Akobundu, P. L., Ukwunna, J. C., Ndukwe-Ani, P. A., & Oyelade, O. (2024). Environmental consequences of energy commodities and economic growth: Evidence from Nigeria. https://doi.org/10.5897/jeif2023.1208 Jibrin, A., Zubairu, S. M., Abdulkadir, A., Kaura, S. J., & Baminda, A. B. (2014). Carbon sequestration potential of Kpashimi Forest Reserve, Niger State, Nigeria. https://doi.org/10.18488/journal.10/2014.3.12/10.12.145.158 Levinson, A., & Taylor, M. S. (2008). Unmasking the pollution haven effect. International Economic Review, 49(1), 223–254. https://doi.org/10.1111/j.1468-2354.2008.00478.x Mather, A. S. (1992). The forest transition. Area, 24(4), 367–379. Retrieved from https://www.jstor.org/stable/20003181 Mirziyoyeva, Z., & Salahodjaev, R. (2022). Renewable energy and CO2 emissions intensity in the top carbon intense countries. https://doi.org/10.1016/j.renene.2022.04.137 Miti?, P., Fedajev, A., & Koji?, M. (2023). Exploring the economy – environment interactions in the Western Balkans. https://doi.org/10.28934/ea.23.56.1.pp43-56 Muhammad, A. Y. (2015). Critical factors affecting the development and diffusion of renewable energy technologies (RETS) in Nigeria. Retrieved from https://www.jmest.org/wp- content/uploads/JMESTN42351013.pdf Mustapha, M., Seraj, M., Ozdeser, H. (2024). The empirical assessment of renewable energy consumption, CO2 emissions and economic growth of Nigeria. https://doi.org/10.37256/ujcr.2220244874 Nibedita, B., & Irfan, M. (2024). Energy mix diversification in emerging economies: An econometric analysis of determinants. Renewable and Sustainable Energy Reviews, Elsevier, 189(PB). https://doi.org/10.1016/j.rser.2023.114043 Ogana, T. E., & Ogana, F. N. (2019). Quantification of the effect of agriculture on forest carbon stock: Case study of a Nigerian forest reserve. https://doi.org/10.22271/TPR.2019.V6.I1.015 Ogundipe, A. A., Okwara, C., Ogundipe, O. M. N. (2020). CO2 emissions and environmenta implications in Nigeria. https://doi.org/10.32479/ijeep.8050 Omisakin, D. (2009). Economic growth and environmental quality in Nigeria: Does Environmental Kuznets Curve Hypothesis hold? Environmental Research Journal, 3(1), 14-18. Oyebanji, I. J., Bamidele, A., Khobai, H., & Roux, P. L. (2017). Green growth and environmental sustainability in Nigeria. International Journal of Energy Economics and Policy, 7, 216- Parajuli, R., Joshi, O., & Maraseni, T. N. (2019). Incorporating forests, agriculture, and energy consumption in the framework of the Environmental Kuznets Curve: A dynamic panel data approach. https://doi.org/10.3390/SU11092688 Parcel, A. (2020). New insights into the environmental Kuznets curve hypothesis in developing a transition economies: a literature survey. https://doi.org/10.1007/s10018-020-00272-9 Raihan, A., & Tuspekova, A. (2022). Nexus between energy use, industrialization, forest area, and carbon dioxide emissions: New insights from Russia. https://doi.org/10.56556/jescae.v1i4.269 Sirag, A., Matemilola, B. T., Law, S., & Bany-Ariffin, A. N. (2018). Does environmental Kuznets curve hypothesis exist? Evidence from dynamic panel threshold. https://doi.org/10.1080/21606544.2017.1382395 Ssali, M. W., Du, J., Hongo, D. O., & Mensah, I. A. (2018). Impact of economic growth, energy use and population growth on carbon emissions in Sub-Sahara Africa. Journal of Environmental Science and Engineering, 7, 178-192. doi:10.17265/2162- 5263/2018.05.002 Sulaiman, C. (2014). The causality between energy consumption, CO2 emissions and economic growth in Nigeria: An application of Toda and Yamamoto procedure. Retrieved from Semanticscholar.org Teng, T., Liu, F., & Chiu, Y. (2024). The change in energy and carbon emissions efficiency after afforestation in China by applying a modified dynamic SBM model. https://doi.org/10.1016/j.energy.2020.119301 Uçak, H., Aslan, A., Yucel, F., & Turgut, A. (2015). A dynamic analysis of co2 emissions and the GDP relationship: empirical evidence from high-income OECD countries. Energy Sources, Part B: Economics, Planning, and Policy, 10, 38 - 50. Ugwu, J., Odo, K. C., Oluka, L. O., & Salami, K. O. (2021). A systematic review on the renewable energy development, policies and challenges in Nigeria with an International Perspective and Public Opinions. https://doi.org/10.14710/ijred.2022.40359 Upadhyaya, M., Kharel, Y. R., Paudel, K. O., & Nepal, P. (2025). Carbon dioxide emissions, forest area, and economic growth of SAARC countries: Evidence from FMOLS approach. https://doi.org/10.21511/ee.16(1).2025.02 World Bank (2022). Forest

More Articles from INTERNATIONAL JOURNAL OF ECONOMICS AND FINANCIAL MANAGEMENT

Bridging Legal, Financial, and Data Governance in Enterprise AI: Emerging Trends

Author: Funmilayo Ashore-Onisemo, Ebehiremen Faith Iziduh, Uchechi Mary-Linda Unamma, Ifeanyichukwu Jeffrey Okwesa

Macroeconomic Policies and Economic Stability in Nigeria

Author: Abel-Tariah Emmanuel Onate, Okon, Ekanem Nsikhe, Nwenyi Francis Onwe

Determinants of Bank Liquidity in Nigeria

Author: Nelson Johnny Ebifemo-ere Stephen