Electricity shortages are key barrier to Africa's industrial growth, Schneider Electric warns

Persistent power shortages and unreliable electricity supply are significantly undermining manufacturing growth and limiting industrial competitiveness across Africa, Schneider Electric has warned. The company stressed that energy deficits remain one of the biggest obstacles to the continent's economic transformation.

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Energy deficits remain one of the biggest obstacles to economic transformation.

Schneider Electric highlighted that Africa's drive toward industrialization, digital transformation, and regional trade expansion is increasingly constrained by inadequate energy infrastructure. This is occurring despite growing ambitions under initiatives like the African Continental Free Trade Area (AfCFTA). Ajibola Akindele, General Manager for Anglophone Africa at Schneider Electric, stated that energy is the foundation for all major development pathways, from industrial growth to urbanization.

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Energy remains the foundation of every major development pathway, from industrial growth to digital transformation and urbanisation.

Akindele noted that Africa's energy access challenge remains critical, with nearly 600 million people still lacking electricity, according to World Bank data. Nigeria alone contributes over 80 million people to this figure, representing one of the largest energy access gaps globally. He described the situation not merely as an infrastructure deficit but as a "productivity ceiling" that restricts industrial output and economic efficiency throughout the region.

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This is not simply an infrastructure gap. It is a productivity ceiling.

The company also pointed to a significant financing gap, estimating that Africa requires approximately $200 billion annually to meet its energy access goals by 2030, while current investments hover around $110 billion. This shortfall presents a structural challenge affecting broader economic development. Akindele identified two accelerating forces increasing pressure on West Africa's energy systems: the rapid expansion of artificial intelligence and digital infrastructure, and the region's push for industrial localization under the AfCFTA. He noted that global data center electricity demand rose about 17% in 2025 due to AI and cloud computing, while Nigeria's data centers already rely on alternative power sources due to grid instability. Simultaneously, manufacturers across West Africa continue to depend heavily on diesel generators, increasing costs and reducing competitiveness. "These two forces, digital acceleration and industrial expansion, are not separate narratives. They are converging on the same constraint," he said.

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These two forces, digital acceleration and industrial expansion, are not separate narratives. They are converging on the same constraint.