Determinants of Load Capacity Factor in Nigeria: Implications for Sustainable Development
Abstract
Research purpose
Motivated by the growing level of ecological degradation and the need to accomplish sustainable development, this study examines the influence of energy consumption, institutions, urbanization, education, and economic growth on the load capacity factor (LCF) of Nigeria.
Methodology
The study uses data from the Nigerian time series between 1984 and 2020. The Autoregressive Distributed Lag (ARDL) is utilized to analyse the level of cointegration and short- and long-run impact among the variables. Furthermore, Fully Modified Ordinary Least Squares (FMOLS), Dynamic Ordinary Least Squares (DOLS), and Canonical Cointegrating Regression (CCR) were used as robustness checks for the long-run estimates of ARDL.
Findings
The results suggest that in the short run, per capita income, institutions, and urbanization positively influence the LCF. However, in the long run, per capita and institutions have an insignificant effect on the LCF. On the other hand, energy consumption and primary school enrolment negatively impact the LCF in both periods. Similarly, urbanization has a negative long-run influence on the LCF, thus decreasing the environmental quality.
Practical implications
Based on the study's outcome, the study offers significant policy implications, such as changing consumption and production patterns to green ones to achieve green growth and sustainable development.
© 2025 James Temitope Dada, Mosab I. Tabash, Mamdouh Abdulaziz Saleh Al-Faryan, Temidayo Oladiran Akinbobola, published by University College of Economics and Culture
This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 License.