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Africa’s digital economy is entering a new phase of growth, with a sweep of national data sovereignty ambitions enhancing the demand for domestic data centers, cloud infrastructure and AI computing capacity. Ahead of the Renegade Intel track this October, African Energy Week spoke to Oneyka Cindy Ojogbo, CEO and Managing Partner, CLG Global, about the intersection of Africa’s data center boom and energy reform agenda.

How are African legal frameworks evolving to manage the overlap between energy regulation and data sovereignty?

Africa is making significant legislative progress on both fronts, but the honest assessment is that the two frameworks are largely developing in parallel rather than in genuine coordination, and the gap between them is widening as the practical convergence of energy infrastructure and data infrastructure intensifies.

On data sovereignty, the continent has made substantial progress over the past decade. More than 36 African countries now have data protection legislation in place or in advanced stages of enactment, with South Africa's POPIA, Kenya's Data Protection Act, Nigeria's Nigeria Data Protection Act, Senegal's data protection framework, Egypt’s Law No. 151 of 2020 and Rwanda's emerging regime among the more sophisticated examples. The African Union's Convention on Cyber Security and Personal Data Protection, known as the Malabo Convention, provides a continental reference framework and was adopted to establish a unified legal framework for data protection on the continent. As of today, ratification of this convention remains limited and implementation is uneven.

On energy regulation, the picture is equally active but similarly fragmented. Most African jurisdictions have enacted or are revising their electricity and energy regulatory frameworks to accommodate independent power producers, renewable energy procurement, and the increasing role of private capital in power generation and distribution. South Africa's Electricity Regulation Act amendments, Nigeria's Electricity Act 2023, Kenya's Energy Act and a range of national energy transition strategies reflect a continent that is actively reconsidering how energy is generated, priced and distributed.

The challenge lies at the intersection. Data centers are simultaneously large energy consumers, critical national infrastructure and repositories of sovereign data, yet very few African regulatory frameworks have been designed with this convergence in mind.

From a legal structuring perspective, what are the key risks investors face in African data center projects?

Power reliability is arguably the most acute legal risk in African data center projects because it is both operationally existential and contractually complex. Power purchase agreements must be carefully structured to address not just pricing but reliability, including guaranteed offtake volumes, curtailment provisions, step-in rights and compensation mechanisms for outages. Where the national grid cannot be relied upon as a primary power source, investors must structure their projects around captive power generation, including backup diesel or gas generation, renewable energy with battery storage, or hybrid arrangements, and the legal and regulatory framework governing these arrangements must be clearly understood and documented.

Currency exposure risks are not exclusive to data center projects, but they are consequential to the very viability of the project. Data center revenues are typically dollar-denominated, while operating costs are in local currency and repatriation is subject to exchange control frameworks. In jurisdictions with active exchange control regimes, investors must structure projects carefully to ensure revenues can be repatriated efficiently, using exchange control approvals, offshore holding structures or investment treaty protections where available.

The key regulatory stability risks in African data center projects include changes to data localization requirements that alter the commercial case for in-country infrastructure, changes to energy regulation that affect the cost, availability or legal basis of the project's power arrangements and changes to foreign investment regulations that affect ownership structures or repatriation rights, among others. Comprehensive regulatory due diligence at the outset of the project, covering not just current regulatory requirements but the trajectory of regulatory development in the country, is essential to identifying and mitigating these risks before they crystallize.

How can governments design frameworks that ensure local value capture without deterring hyperscale investment?

The challenge between local value capture and attracting investors is the central policy challenge of African data center development. Finding the right balance requires careful policy design, credible institutions and genuine collaboration with investors. A consistent, transparently applied framework will attract more investment than a theoretically superior one that is applied inconsistently or subject to frequent revision.

Local content is important. Governments must sequence local content requirements carefully, distinguishing between what is immediately achievable and what requires time to build. Employment, training, local procurement and management representation can be mandatory from the outset. Equity participation and technology transfer should be phased in over time with clear milestones, designed around what the local market can genuinely deliver rather than aspirational targets that investors will simply price as unachievable risk.

Power reliability is a non-negotiable prerequisite. No data center investment framework will attract hyperscale capital without addressing power. South Africa, Kenya and Egypt have all partially succeeded because they addressed this directly. Tax incentives should reward local value creation rather than simply the presence of infrastructure, tied to employment, procurement, skills development and renewable energy use.