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Africa’s digital economy is entering a new phase of rapid expansion, driven by rising demand for domestic data centres, cloud services, and artificial intelligence infrastructure as countries pursue stronger data sovereignty policies.
However, experts warn that while legal and regulatory frameworks are advancing across the continent, energy regulation and data governance are largely evolving in parallel rather than in coordination, creating growing structural gaps.
Speaking on the intersection of both sectors, Oneyka Cindy Ojogbo, CEO and Managing Partner of CLG Global, noted that more than 36 African countries now have data protection laws in place or at advanced stages of development, including South Africa, Kenya, Nigeria, Senegal, Egypt and Rwanda.
She highlighted that frameworks such as South Africa’s POPIA, Kenya’s Data Protection Act, and Nigeria’s Data Protection Act reflect significant progress, while the African Union’s Malabo Convention provides a continental benchmark, though ratification and implementation remain limited.
On the energy side, she observed that reforms are also progressing, with countries revising electricity laws to accommodate private investment, the integration of renewable energy, and independent power producers. Examples include Nigeria’s Electricity Act 2023, Kenya’s Energy Act and South Africa’s regulatory amendments.
Despite these developments, she warned that the intersection between the two sectors remains underdeveloped, particularly because data centres serve as critical infrastructure, major energy consumers, and repositories of sovereign data.
Ojogbo identified power reliability as the most significant legal and operational risk for investors, stressing the need for carefully structured power purchase agreements that address supply guarantees, outage compensation and backup generation systems.
She also pointed to currency risk as a key concern, noting that data centre revenues are often dollar-denominated while operating costs are local, creating exposure to exchange rate volatility and repatriation restrictions in some jurisdictions.
Regulatory uncertainty, including shifting data localisation rules, energy policy changes and evolving foreign investment laws, was also highlighted as a major challenge requiring robust due diligence and long-term planning.
On policy design, she argued that governments must strike a balance between attracting hyperscale investment and ensuring local value capture through predictable regulations, phased local-content requirements, and incentives tied to employment, skills development, and renewable energy adoption.
She added that consistent and transparent regulation would do more to attract investment than overly ambitious policies that are difficult to implement or enforce.
