EFFECT OF ENVIRONMENTAL (CARBON) TAXES ON NIGERIA'S INDUSTRIAL EMISSIONS

This study examines the effect of environmental (carbon) taxes on industrial emissions in Nigeria to address the persistent challenge of high industrial CO₂ emissions that contribute to environmental degradation and climate change. Despite global and national efforts to mitigate emissions, Nigerian industries continue to rely heavily on fossil fuels, inefficient energy practices, and limited adoption of cleaner technologies. This study specifically investigates the impact of carbon tax collections, energy intensity, industrial output, technological advancement, and fossil fuel share on industrial emissions. An ex-post facto research design was adopted using secondary data from 2000 to 2023, with the population comprising all industrial sectors and a purposive sample of 23 firms from the petroleum and refining, power generation, and manufacturing sectors. Data were collected from the National Bureau of Statistics (NBS), Central Bank of Nigeria (CBN), Ministry of Environment, Energy Commission of Nigeria, and industry annual reports and analyzed using descriptive statistics, correlation analysis, and multiple regression techniques. The findings reveal that carbon taxes and technological advancement significantly reduce industrial emissions, whereas energy intensity, industrial output, and fossil fuel share significantly increase emissions. Based on these results, the study recommends strengthening carbon tax policies, promoting energy-efficient and low-carbon technologies, encouraging green industrial expansion, and reducing fossil fuel dependency to enhance Nigeria’s environmental sustainability