Electricity Consumption, Renewable Energy Share, and Industrial Production in the Philippines: Mediation Analysis from Aggregate and Sectoral Time-Series Data
DOI:
https://doi.org/10.69569/jip.2026.406xKeywords:
Electricity consumption, Industrial production, Ordinary least squares, Renewable energy share, Sectoral analysisAbstract
This study examines the relationship of renewable energy and electricity consumption, towards Philippine industrial output from 2005 to 2024 (N = 20), while accounting for Brent oil price and joint GFCG and labor in manufacturing as production input. It investigates whether electricity consumption could act as a pathway between renewable energy share and manufacturing output. To capture these dynamics, the study employs ordinary least squares regression (OLS) with Newey-West heteroskedasticity and autocorrelation consistent standard errors, Johansen cointegration testing, Error Correction Model (ECM) alongside a 5,000-replication nonparametric bootstrap. The aggregate model indicates that production input is positively associated with manufacturing output, whereas renewable energy share, electricity consumption, and oil prices are statistically insignificant. The controlled bootstrap indirect effect of renewable energy share through electricity consumption yields is not statistically significant, as the 95% confidence intervals include zero. However, ECM identifies positive and statistically significant short-run associations between changes in renewable energy share, electricity consumption, and manufacturing output. The sectoral-specific estimation further reveals differences in the associations of energy variables and production inputs with output across manufacturing subsectors. Given the limited number of annual observations and the observational research design, the results are interpreted as statistical associations rather than definitive causal effects. These findings indicate that the relationships between variables vary across model specification, time horizons, and manufacturing industries. Future policy must look beyond uniform generation goals to prioritize targeted industrial grid modernization, energy storage deployment, and industry-specific support.
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