Fossil fuel power generation and economic growth in Poland

ABSTRACT

This paper explores the energy (electricity)–economic growth nexus in the case of Poland. The empirical investigation sheds some new light on the relationship between the electricity production from fossil fuel sources (oil, coal, and natural gas) and economic growth based on cointegration and Granger causality analyses with yearly data covering the period 1970–2014. Electricity generation from coal sources is likely to have a strong and positive impact upon economic growth in the long run. The Granger causality analysis supports the conservation hypothesis for the electricity production from natural gas sources, and the neutrality hypothesis for the use of oil and coal in the electric power energy mix. Therefore, it is inferred that energy conservation policies are not likely to harm economic growth and the same policies can be applied for all energy sources. The results complement previous findings in the literature despite differences in methods and data collection.

KEYWORDS:

• Cointegration
• economic growth
• electricity production
• energy conservation
• fossil fuels
• Granger causality
• Poland
• sustainability