DECARBONIZING NIGERIA’S ENERGY MIX: THE ROLE OF RENEWABLE ENERGY CONSUMPTION

Abstract

This study examines the effect of carbon emission from non- renewable energy sources on renewable energy consumption in Nigeria. The augmented Dickey–Fuller test was used to tests for unit root problem and possible cointegration of the variables. With evidence of cointegration, the Fully Modified Ordinary Least Squares approach which was designed by Philips and Hansen in 1990 was employed. This method adjusts the leasts squares to account for serial correlation and possible endogeneity problem, which arises, when using the standard Ordinary Least Squares approach with non-stationary series. Logarithmic transformations were made, with the model transformed into a double log model.   The raw data for the analysis were all sourced from World Bank World Development Index 2019.  The result shows a positive relationship between Trade openness, Co₂ emission from non-renewable sources and renewable energy consumption, with the variables being significant at 5% level. The coefficient value of (0.1949) for Co₂ shows that a percentage increase in Co₂ emission from non-renewable sources of energy, increases renewable energy consumption by just 19% of total energy use. The study found also, that a negative relationship exists between urban population, oil rent, GDP per capita and renewable energy consumption and are significant at 5% level except for oil rent which is not statistically significant. The study recommends, the need to intensify awareness and encourage government and private individuals to consider embracing alternative clean energy sources. That will be a right move in the drive to achieve the Sustainable Development Goals 7(affordable and clean energy) and 13(climate action).