African countries must open up their power markets in order to court the private investors needed to supply the electricity that AI will demand, a data center executive told Semafor, as a new report warned the continent risks seeing little economic benefit from the technology.
Africa's economy is barely expanding on a per capita basis, and household living standards are stagnant across the continent. With the labor force projected to almost double by 2050, many African governments fear growing unemployment in the next few years. AI, as in other parts of the world, offers an opportunity to drive economic growth. But Africa only hosts about 160 data centers — around 5.5% of the global total — and aging grids in many African countries mean access to power, the key driver of AI infrastructure expansion, is limited.
In Africa, independent power producers typically sell electricity to state utilities under long‑term power purchase agreements. But private‑to‑private supply — in which a private generator sells directly to an industrial or commercial buyer using the grid, a practice that is commonplace across the West — remains rare on the continent.
In an interview, Robert Skjødt, CEO of Raxio, a data center company that operates in six African countries, said that in many nations, regulatory reform was needed to "allow a private supplier of electricity to supply to a private buyer" while using the grid.
The potential upside is significant: The International Monetary Fund, in a paper published on Tuesday, said AI could make sub-Saharan Africa's economy around 4% bigger over the next decade than its baseline projection — but that requires better electricity supply, internet access, and digital skills. Policymakers and business leaders have long warned that Africa's power shortfall in particular, if left unaddressed, would starve energy-hungry data centers of the electricity needed to digitize economies.
#private #african #needed #many
Africa's economy is barely expanding on a per capita basis, and household living standards are stagnant across the continent. With the labor force projected to almost double by 2050, many African governments fear growing unemployment in the next few years. AI, as in other parts of the world, offers an opportunity to drive economic growth. But Africa only hosts about 160 data centers — around 5.5% of the global total — and aging grids in many African countries mean access to power, the key driver of AI infrastructure expansion, is limited.
In Africa, independent power producers typically sell electricity to state utilities under long‑term power purchase agreements. But private‑to‑private supply — in which a private generator sells directly to an industrial or commercial buyer using the grid, a practice that is commonplace across the West — remains rare on the continent.
In an interview, Robert Skjødt, CEO of Raxio, a data center company that operates in six African countries, said that in many nations, regulatory reform was needed to "allow a private supplier of electricity to supply to a private buyer" while using the grid.
The potential upside is significant: The International Monetary Fund, in a paper published on Tuesday, said AI could make sub-Saharan Africa's economy around 4% bigger over the next decade than its baseline projection — but that requires better electricity supply, internet access, and digital skills. Policymakers and business leaders have long warned that Africa's power shortfall in particular, if left unaddressed, would starve energy-hungry data centers of the electricity needed to digitize economies.
#private #african #needed #many
5 days ago
