Renewable Energy-Institution-Environment Trilogy: Time-Series Insights from Nigeria
Olamide Micheal Adediwura *
Department of Economics, Adeleke University, Ede, Nigeria.
Ifeoluwa Alao-Owunna
Department of Economics, Adeleke University, Ede, Nigeria.
Sharon Oluwaseun Adeyeye
Department of Economics, Adeleke University, Ede, Nigeria.
*Author to whom correspondence should be addressed.
Abstract
Purpose: This study examines the dynamic relationship among renewable energy consumption, institutional quality, and environmental quality in Nigeria from 1995 to 2024, with emphasis on the moderating role of institutional quality.
Methodology: Annual time-series data were analysed using unit root and cointegration tests, and the autoregressive distributed lag (ARDL) approach. Environmental quality was proxied by CO₂ emissions, and the empirical model included renewable energy consumption, the institutional quality index, their interaction term, and an ICT index.
Findings: The results show evidence of a stable long-run relationship among the variables. In the short run, renewable energy consumption reduces CO₂ emissions, indicating immediate environmental benefits from cleaner energy use. Institutional quality has a positive direct association with emissions, suggesting that governance improvements have not yet translated independently into environmental gains. However, the interaction between renewable energy consumption and institutional quality is negative and statistically significant, indicating that stronger institutions improve the emissions-reducing effectiveness of renewable energy. ICT has no significant short-run effect but contributes to environmental improvement in the long run.
Practical Implications: The findings suggest that renewable energy policy should be implemented alongside institutional reforms that strengthen regulatory enforcement, transparency, accountability, and environmental governance. Originality: The study provides Nigeria-specific time-series evidence on the renewable energy-institution-environment nexus within a unified ARDL framework that explicitly captures moderating dynamics.
Keywords: Renewable energy consumption, institutional quality, environmental sustainability, CO₂ emissions, ARDL bounds testing, Nigeria, ICT index, time-series analysis, clean-energy transition, governance quality