By Koketso Mamabolo
While the focus for the last few years has centred on large language models (LLMs) themselves, and how they’ve transformed the world, the infrastructure behind them has quickly come into the spotlight. Whether it be how Nvidia has become one of the most valuable companies in the world by producing the chips that drive artificial intelligence, or how LLMs require enormous amounts of water and electricity to function, the inputs are now as important as the output.
With large amounts of data constantly being processed the need for data centre capacity to match demand is a major topic for discussion and the big tech companies, also known as hyperscalers, are moving aggressively all over the world.
At the moment there are roughly 12 000 data centres and according to the International Energy Agency these power hungry facilities account for 1.5% of the world’s electricity consumption – a figure which will go up to 4.4% in the next decade. While data centres have been around for a while, AI has been the catalyst for the rapid growth in the last couple years.
Research from Mckinsey found that in the next four years the demand for data centre capacity will go from the current 0.4 GW to between 1.5 and 2.2 GW with as much as $20-billion in investment. In Africa, over 200 facilities across 38 countries account for only 0.6% of the world’s capacity.
Much of the capacity is concentrated in South Africa, Egypt, Kenya and Nigeria but not enough to cater to the continent’s needs. As a result, Africa relies on offshore hosting in Europe and North America which raises issues of data sovereignty, governance and economic independence, according to the African Data Centres Association (ADCA).
This is pushing governments to consider how to shape policy and attract the investment needed to reduce the reliance on offshore hosting. In this year’s budget speech, the Minister of Finance, Hon. Enoch Godongwana sent out a signal to the industry that the state understands its importance.
“The use of data and artificial intelligence has become critical for the future development of economies worldwide. As such data infrastructure should be considered as critical as electricity, ports and transport networks.
“This year we will be exploring options to help data centres and related infrastructure to expand these investments in South Africa and solidify our role as a regional hub for these technologies.”
There are 56 data centres in South Africa with a load capacity of 350 MW. The biggest player in the country is Teraco Group which also has the biggest expansion plans, followed by newcomer Cavaleros Group. They’re competing with Cassava’s African Data Centers, NTT Data, and Vantage Data Centres, among others. Along with the likes of Microsoft and MTN, the expansion plans are enough for us to ask the question of whether or not we have the infrastructure to support the growth.
Sustainable growth
The chips (CPUs and GPUs) generate enormous amounts of heat and that requires large volumes of water to prevent overheating.
The energy needed to power these facilities means greater pressure on electricity grids which already rely heavily on fossil fuels. There are many who have emphasised the need to keep data local but this is clashing with the lack of resources and reliable electricity supply. As Africa Practice’s Caleigh Plaatjes wrote:
“Africa’s path to harnessing artificial intelligence (AI) and other emerging technologies is fundamentally constrained by a single physical truth: the exponential demand for power and water.”
However, this is not a challenge which is unique to the continent. The United States, which accounts for around 40% of global data centre capacity, has seen ongoing disputes between communities, local governments and hyperscalers over the construction of data centres. The concerns over the effect on the demand for electricity and water, and how that could translate into higher power costs and constraints on already fragile water supplies.
The challenge is how to eliminate the risks hyperscaling is placing on communities and resources because data centres have become a foundation layer of economic development.
“Sustainability is now a central consideration for the sector,” said Faith Waithaka, the chairperson of ADCA, in The Economic Report: Data Centres in Africa 2026.
“Improving energy efficiency and integrating renewable energy sources are essential to the viability of data centre operations. Africa is uniquely positioned in this regard, with vast untapped potential across solar, wind, hydro and geothermal resources. Leveraging these assets can support greener data centres while strengthening energy security and long-term competitiveness.”
Data centres are here to stay – the question is how do we make room for them without compromising our future?
Sources: Daily Maverick | ADCA | Africa Practice | McKinsey | Tech Central | Africa.com | Teraco | Statista
