Electricity Access, Electricity Consumption, and Economic Performance in Sierra Leone: Evidence from an ARDL Bounds and Error-Correction Framework (2000–2024)

Abstract

Electricity access is key to Sierra Leone’s development strategy, yet persistent reliability, affordability, and utility-finance constraints raise concern that more connections may not lead to productive electricity use. This study examines whether electricity access and electricity consumption are associated with economic performance in Sierra Leone, and distinguishing between long-run equilibrium effects and short-run adjustment dynamics. Using annual time-series data for 2000–2024, the paper estimates an Autoregressive Distributed Lag (ARDL) model, applies the bounds test for cointegration, and derives an unrestricted error-correction model (UECM). The bounds test confirms a stable long-run relationship among GDP per capita, electricity access, electricity consumption, investment, trade openness, and inflation (F-statistic = 5.07). Long-run estimates show that electricity access has a positive elasticity (0.0718), while electricity consumption per capita is economically negligible (-0.0008). Investment is strongly positive (0.2195). The error-correction term is negative (-0.393), implying that about 39% of disequilibrium is corrected within one year. The findings suggest that Sierra Leone’s growth payoff from electrification depends less on expanding connections alone and more on improving reliability, reducing losses, strengthening sector governance, and promoting productive electricity use.