South Africa is expected to account for 77% of Africa’s projected increase in data centre electricity demand over the next decade, putting the country at the centre of the continent’s growing digital infrastructure power requirements.
This is according to the Africa Data Centre Power Outlook, published by energy market intelligence provider Electron Intelligence.
It notes that South Africa is forecast to contribute 7.77 terawatt-hours (TWh) of additional electricity demand by 2035, as cloud adoption, enterprise digitisation and demand for locally-hosted data drive expansion of data centre capacity.
The report draws on power procurement records covering 177 operating and 29 planned data centre facilities, alongside electricity cost models and industrial tariff benchmarks.
Its analysis also examines South Africa’s electricity procurement environment, including wheeled renewable energy and multi-site power purchase agreements.
The report notes that Africa’s total data centre electricity consumption is projected to increase from 2.55TWh in 2025, to 6.95TWh in 2030, reaching 12.60TWh by 2035.
However, it cautions that the expansion of announced data centre capacity does not necessarily translate into immediate electricity demand, or commercial opportunities for independent power producers.
It says only 337MW, or 52%, of Africa’s 647MW announced additional IT capacity pipeline has a scheduled commissioning date by 2035.
The continent will also need another 583MW of unannounced IT capacity to meet projected demand under the report’s base-case scenario, the report adds.
South Africa accounts for approximately 513MW of that additional capacity requirement, while Kenya’s identified pipeline already exceeds its forecast 2035 requirement.
The report estimates that average facility power demand across Africa will reach 1 438MW by 2035, while the combined peak power requirement across individual sites will hit 1 598MW. Colocation operators are expected to account for approximately 90% of the continent's demand growth.
David Oni, head of research at Electron Intelligence, says data centre developers and power suppliers should not base investment decisions solely on announced campus capacity.
“Announced IT megawatts are a poor guide to near-term electricity sales,” he says.
“In 2025, average IT draw across operating facilities is less than half of installed IT capacity, so immediate load growth will come from tenants filling existing data halls rather than new shells. Because colocation facilities account for nearly nine-tenths of continental demand growth through 2035, power developers and lenders must underwrite signed tenant commitments and actual rack loading rather than master-planned campus capacity.”
Wheeling opportunity
The research identifies renewable energy wheeling as one of the opportunities for power developers looking to supply South Africa’s expanding data centre market.
In a model based on a 12MW IT facility consuming 97 gigawatt-hours annually, supplementing utility electricity and on-site backup with wheeled solar reduces the modelled cost of electricity by 11.5%.
The cost falls from $126.78 per megawatt-hour (MWh) to $112.19/MWh, translating into estimated annual savings of approximately $1.42 million.
However, the report points to grid connection capacity, municipal wheeling rules, transmission-use charges and electricity tariff structures as factors influencing the commercial viability of alternative power arrangements.
It also cautions that the availability of new power contracts depends on existing supply agreements and actual demand at individual campuses.
Risks for investors
Despite the growth outlook, Electron Intelligence warns that power developers and infrastructure investors face risks if they commit capital before data centre operators secure sufficient customers.
Under its delayed-growth scenario, Africa’s data centre electricity consumption reaches 6.44TWh in 2035, 49% below the base-case forecast of 12.60TWh.
The difference between the two scenarios amounts to 26.6TWh in cumulative electricity demand over the 2026-2035 period, with approximately 80% of the shortfall occurring after 2030. South Africa accounts for 78% of the projected 2035 shortfall.
“The primary risk for power investors is committing capital before electricity revenue is secured, particularly where high-voltage substations, transmission connections, or gas pipelines cannot be built in small increments,” Oni says.
“When upfront shared infrastructure is required, first-phase contracts need minimum purchase obligations, termination protections, or grid-wheeled remarketing options so developers are not left carrying underutilised assets if tenant occupancy lags.”
The report also examines power supply economics in other African markets. In Nigeria, for example, natural gas generation supplemented by diesel backup could reduce delivered electricity costs by 54% to 60% compared with continuous diesel generation.
“Comparing power options on capital cost alone understates the operational and contractual requirements of maintaining continuous data-centre operations,” says Oseiwe, consultant at Electron Intelligence.
“In Nigeria, moving from continuous diesel to gas with diesel backup cuts delivered power costs by more than half, but project viability still depends on gas delivery infrastructure, facility utilisation, and whether a project falls under state or federal electricity licensing in Lagos and Ogun. In South Africa, Kenya, Egypt and Morocco, the commercial case turns on municipal wheeling rules, transmission-use charges and off-peak industrial tariff structures.”
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