Africa Data Center Power - Market Share Analysis, Industry Trends & Statistics, Growth Forecasts (2024 - 2029)

The Africa Data Center Power Market size is estimated at USD 502.70 million in 2024, and is expected to reach USD 925.5 million by 2029, growing at a CAGR of 13.40% during the forecast period (2024-2029).

African data centers use a considerable amount of power, and commercial DC power usage has been growing by an average of 40% annually over the past five years as adoption has accelerated. It was expected to pass the 4,000 GWh mark in 2022. South Africa's power grid has experienced challenges with reliability and stability, leading to potential disruptions in data center operations. Data centers require a reliable and stable power supply to ensure uninterrupted operations, and grid instability can impact their sustainability efforts. Such factor leads to major market demand.

Key Highlights

• The upcoming IT load capacity of the Africa data center power market is expected to reach 1,226 MW by 2029.
• The region's construction of raised floor area is expected to increase 5.2 million sq. ft by 2029.
• The region's total number of racks to be installed is expected to reach 260 K units by 2029. South Africa is expected to house the maximum number of racks by 2029.

There are close to 70 submarine cable systems connecting Africa, and many are under construction. One such submarine cable that is estimated to start service in 2024 is Africa-1, which stretches over 10,000 km with landing points in Port Said and Ras Ghareb in Egypt.

Africa Data Center Power Market Trends

IT and Telecom to Hold Significant Share

• Telecom providers are primarily responsible for driving content delivery and facilitating mobile and cloud services, which is why telecom data centers require high connectivity. This specific type of data center is connected to other data centers, cloud providers, and telecom operators through outside plant (OSP) cables, with cross-connects extensively deployed to ensure efficient operations.
• Nigeria has one of the largest telecom markets in Africa, supported by the second-largest economy on the continent after South Africa. In February 2023, the Nigerian Communications Commission, the Nigerian telecom regulator, reported that the number of active mobile telecommunication plan subscriptions in the country reached about 222,571 million in 2023, which shows the demand for mobile services in Nigeria. Overall, the increasing network traffic is leading to major data center investment and DC power adoption.
• According to the NCC (Nigerian Communications Commission), as of June 2022, Nigeria's broadband penetration was 44.30%, with more than 84 million subscriptions, compared to about 76 million in 2022. COVID-19 boosted subscriber counts under remote working schemes. With increasing data center construction, the demand for the market is expected to increase.
• The rapidly increasing 4G penetration and the upcoming 5G wave are adhering telecom vendors to invest in the African data center power market. In October 2022, the South African telecom provider Telkom established the 5G high-speed internet network with the help of Huawei Technologies from China. Huawei continues to assist South Africa in developing its 5G networks. The prominent 5G network on the African continent has more than 2,800 base stations deployed.
• The deployment of 5G would play a key role in pushing the expansion plans and executing them as planned. For 5G networks and ubiquitous broadband, the country requires 167,000 km of fiber infrastructure. Data center facilities will be in demand in Nigeria as fiber connectivity increases and advanced technologies can be used remotely. Such factors will lead to major data center power adoption.

South Africa to Register Significant Growth

• Despite recent investments in data center infrastructure in Sub-Saharan Africa, much of the continent's capacity remains in South Africa, where local providers brought more than 50 MW of dedicated data center IT load capacity online between 2017 and 2019.
• In South Africa, unstable power supplies that are still heavily fossil fuel dependent and increasingly expensive are significant challenges for the data center industry. Over and above the critical importance of a stable power supply, responsible corporate citizenship, and meeting environmental, social, and governance (ESG) practices combine to put significant pressure on data center owners to service the continent and ensure that Africa can keep pace with the rest of the world.
• South Africa receives more than 2,500 hours of sunshine annually, with average solar radiation levels ranging between 4.5 and 6.5 kWh/m2 daily. The country's average solar radiation of about 220 Watts per square meter is more than double that of Europe (100 W/m2). Solar energy, therefore, is one of the most promising renewable energy options for reducing dependency on the grid. The Northern Cape has become a hotspot for solar power plant investments, which expects the major demand for solar generators during the forecast period.
• The cloud switched PDU series provides a versatile power management solution featuring advanced surge protection, seamless cloud management, and easy installation. To take benefit of this untapped market, various large cloud companies are adopting such PDUs with increasing investment in the country. AWS announced plans to launch data center infrastructure in the country. AWS invested ZAR 15.6 billion (USD 858 million) through 2022 to meet customer demand for cloud computing services.
• Switched power distribution units also allow key personnel to control the on/off state of individual outlets remotely. This allows operators to manage critical loads, avoid wasted power, ensure equipment is plugged into the correct phase, and manage schedules. In South Africa, HPE offers HPE G2 metered and switched PDU, providing local and remote power management with outlet-level power metering and switching. An LCD screen provides local monitoring and alert indications, while remote access and configuration are obtainable through secure web, SNMP, CLI, or telnet interfaces.

Africa Data Center Power Industry Overview

The African data center power market is slightly consolidated among the players and has gained a competitive edge in recent years. A few major players in the market include Aggreko ZA, ABB Ltd, and Cummins Inc. These major players with a prominent market share focus on expanding their customer base across the region. These companies leverage strategic collaborative initiatives to increase their market share and profitability.

• In April 2024, Vertiv, a significant provider of critical digital infrastructure and continuity solutions, introduced the extension of the Vertiv Liebert GXT5 lithium-ion double-conversion, online uninterruptible power supply (UPS) system for 5 kVA-10 kVA global voltage (GV) (200 V-240 V; default 230 V) applications.
• In January 2024, Caterpillar Inc. partnered with Microsoft and Ballard Power Systems to test the use of large-format hydrogen fuel cells as a reliable and eco-friendly backup power source for multi-megawatt data centers. Hydrogen fuel cells are seen as a possible low-carbon alternative to diesel backup generators, which is expected to drive the growth of DC generators.

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