Africa’s data center market is growing at an unprecedented rate writes Ben Selier, Vice President: of Secure Sower, Anglophone Africa at Schneider Electric

Ben Selier, Vice President: Secure Power, Anglophone Africa at Schneider Electric. 

We all need some good news. In a time where the world is facing a myriad of challenges, be it financial, geopolitical or environmental, growth and development certainly equate to good news.

Africa’s data center market is growing at an unprecedented rate, driven by soaring demand for digital services, AI (artificial intelligence), cryptocurrencies, and cloud computing. According to recent statistics, the data center market is projected to reach over $7 billion by 2028, at a compound annual growth rate (CAGR 2024-2028) of 7%.

It is good news indeed, as Africa’s burgeoning digital landscape also presents significant opportunities for investors, technology companies, and local businesses. However, there’s a caveat; data center planners must ensure that these facilities are built with the continent’s power provision, local economy, and geographical challenges in mind.

Local knowledge is power

Current data centers are positioned in a crowded market where supply often exceeds short-term demand. This means that local suppliers often have to meet the extremely complex requirements of mammoth hyperscalers which can be prohibitively expensive in some instances simply inaccessible.

For the African data center market to flourish, local business expertise must be utilized. For one, local providers understand the financial constraints and specific needs of African businesses and can offer tailored solutions at more affordable prices. Similarly, by catering to the budgets and requirements of local enterprises and SMEs, these providers can tap into a much broader customer base and achieve more sustainable growth.

Another important step is considering the physical data center facility.  Here, existing buildings like older factories, railroad buildings, etc can be repurposed, and intelligent software solutions implemented to optimize resource management and operations whilst driving down costs.

From an energy management perspective, these buildings can be retrofitted with load balancing features, service optimization, and adaptive power allocation which can enhance facilities’ efficiency while ensuring optimal performance during peak usage periods.

Prefabricated modular data centers are also a compelling alternative solution to the African data center market. It offers a dynamic response to the need for rapid deployment, standardization, and sustainability.

As the name suggests, these data centers consist of pre-built modules that house various components critical to data center functionality. The modules fall into categories such as power, cooling, and IT.

A major advantage of prefabricated data centers is the efficiency and predictability it brings to the construction process. Unlike traditional data centers, where one must contend with the variability of handling material and availability, prefabricated data centers can be produced in local, controlled factory environments.

The Sustainability Balancing Act

As mentioned earlier, power provision is a significant stumbling block in the proliferation of data centers in Africa.  Whilst not a challenge unique to the continent, data center providers will have to be prudent when planning facilities and their expected power consumption.

And even if countries’ grid infrastructure can handle new capacity demands, it is facing another challenge: decarbonization. In the US, for example, new sustainability standards – targeted at data centers – are currently under consideration or have been enacted.

Also, let us not forget power reliability. The 2022 Uptime Report on IT downtime found that the cost of downtime continues to grow:

• One out of five data centers experienced a ‘serious’ or ‘severe’ outage in the last three years, and 80% of all data centers experienced some type of outage.
• Over 60% of data center outages cost at least USD100,000, while outages costing over USD1 million grew from 11% to 15% in just three years.

This scenario is prevalent across the globe and Africa is not the exception. Fortunately, when building data centers, a distributed energy resources (DER) solution, if you will, can be built to stabilize supply. These include:

• Renewables such as solar and wind
• Battery energy storage systems and UPSs.
• Fuels cells, including hydrogen and other nascent or emerging resources.
• Combined cooling, heating, and power.
• Right-sized natural gas or diesel generators.

By managing the above DERs using technology such as Schneider Electric’s EcoStruxure Microgrid Advisor, your data center operation will be improved, demand response optimized, and the system can be setup to run autonomously (island mode) or as part of the grid.