EFFECT OF NON-RENEWABLE ENERGY ON SELECTED MANUFACTURING SECTOR OUTPUTS IN NIGERIA
Abayomi Awujola, PhD , Obumneke Ezie, PhD and Effiong Emmanuel Sunday
Volume 9 Issue 2
Abstract
Despite several reforms in energy sector, some manufacturers still depend on alternative sources of energy such as generators and other machines powered by either gas or petroleum for their productive activities. The study examined the effect of non-renewable energy on selected manufacturing sector outputs in Nigeria on the use of annual time series data covering 1986- 2021. The study employed the ARDL regression technique because the ADF unit root revealed mixture of 1(0) and 1(1) order of integration. The results revealed that petroleum energy (PEC) and hydroelectric consumption (HEC) had insignificant negative effect on both cement manufacturing output (CMO) and food and beverages output (FBO). The findings also revealed that gas energy consumption (GEC) had significant positive effect on both cement manufacturing output (CMO) and food and beverages output. The ARDL-ECM coefficients of 16 percent and 13 percent revealed a poor speed of adjustment path after a shock. The paper Concluded that gas energy has significant impact on selected manufacturing sector output in Nigeria and recommends that manufacturing sector reform measures should take into cognizance petroleum sector dynamics since rent seeking in the petroleum sector was found to affect the manufacturing sector negatively and federal government should invest in alternative sources of energy such as solar and wind considering the fact that other energy sources were found to be important determinants of the output of the selected manufacturing sector in Nigeria. Keywords: Non-Renewable Energy, Cement, Food and Beverages, Gas Energy, Hydro-Energy
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