Impact of Energy Equity on Industrial Sector Growth in Nigeria

This study examined the impact of energy equity on industrial sector growth in Nigeria, focusing on fossil fuel energy consumption, access to electricity, and electric power consumption, over the period 1999–2023. The Fully Modified Ordinary Least Squares (FMOLS) technique was employed to estimate the long-run relationship between energy equity and industrial growth, after confirming stationarity and cointegration among the variables. Findings revealed that fossil fuel energy consumption had a positive and significant impact on industrial sector growth, indicating that industries remained heavily reliant on petroleum-based energy sources. Access to electricity also showed a positive and significant relationship with industrial output, suggesting that improved electrification enhanced productivity. However, electric power consumption exhibited a negative but significant impact on industrial growth, implying that inefficiencies in power supply, high electricity costs, and unreliable grid distribution offset the potential benefits of increased energy consumption. Based on these findings, the study recommended that the Nigerian National Petroleum Corporation (NNPC) and the Energy Commission of Nigeria (ECN) should implement policies promoting alternative energy sources and improving refining capacity. The Federal Ministry of Power and the Rural Electrification Agency (REA) were advised to accelerate industrial electrification projects, while the Nigerian Bulk Electricity Trading Company (NBET) and power distribution companies (DisCos) were urged to enhance electricity distribution efficiency. Furthermore, the National Agency for Science and Engineering Infrastructure (NASENI) and the Standards Organisation of Nigeria (SON) were recommended to enforce energy efficiency standards for industrial machinery to improve overall energy utilization. Addressing these challenges would ensure that Nigeria's industrial sector fully benefits from stable and cost-effective energy access.