Six hundred million power gaps sit inside the industrial plan

The first document in an industrial investment case should be the power study, not the artist's rendering. The International Energy Agency estimates that around 600 million people in Africa lack reliable electricity access. Factories can and do operate inside that deficit. They pay for the workaround.

The continental number does not establish conditions at a proposed site. It tells investors and governments that electricity cannot be assumed. Measure the connection, outages, quality, expansion path and full backup system before promising output.

A stopped line still costs.

Define the load

List each production process, motor, furnace, cooling system, control, warehouse and office load. Identify peak demand, continuous demand, start-up current and equipment that cannot tolerate interruption.

A plant's nameplate megawatts can hide timing. Two large machines may not run together. A short peak can set the connection charge. Demand management or process scheduling can reduce capacity required, subject to production targets.

Quality matters beside supply. Voltage variation can damage equipment or spoil a batch without a long outage. Sensitive controls may need conditioning and uninterruptible power even on a connected grid.

Forecast expansion explicitly. A connection adequate for the first line can strand the second. Reserving unused capacity has a cost; rebuilding a substation later has another.

Obtain evidence from the site

Utility letters should name available capacity, connection works, tariff class, expected completion and customer contribution. A general national generation figure cannot substitute for local network capacity.

Collect outage records where available and install monitoring during diligence. Interview nearby industrial users, then verify their experience against logs. Different feeders can produce different service within one area.

Map transmission, substation and last-mile dependencies. Name the agency or contractor responsible for each upgrade. If public works arrive late, identify whether the plant can commission at reduced load.

Tariff terms can include energy, maximum demand, time bands, power factor, taxes and adjustments. Model the actual load profile instead of multiplying one published rate by annual kilowatt-hours. Reconstruct at least one month interval by interval, apply the contractual demand charge and show which cost remains when production stops. That exercise can reveal that reducing a brief peak saves more than a broad energy-efficiency claim, or that a nominally cheap tariff is outweighed by backup operation.

Price the workaround

Backup generation needs capital, fuel, storage, maintenance, operators and permits. Fuel price and delivery can interrupt the backup itself. Running generators at inefficient load raises unit cost.

Batteries respond quickly and can cover short outages or shift peaks. Their usable capacity, degradation, temperature control and replacement belong in the model. Solar can lower energy cost and requires land, inverters and a plan for nights and clouds.

A hybrid system can improve reliability while adding controls and maintenance skills. The plant needs a tested sequence for grid loss and return. A failed transfer can stop production even when every component works alone.

Calculate power cost per usable unit of output, including lost and damaged production. Dividing the electricity bill by output misses self-generation and downtime.

Downtime moves through working capital

A stopped line still carries wages, rent, interest and some maintenance. Inputs may wait or spoil. Customer delivery slips, and finished stock may need inspection after an interruption.

The cash model should connect outage hours to production stages. A one-hour loss in a continuous process can require a longer restart. Another plant can resume immediately. Use engineering evidence.

Inventory can buffer customers and tie up cash. Extra raw material protects against transport and power disruption only if storage preserves it. Finished-goods stock can cover downtime while risking obsolescence.

Insurance may cover defined damage or interruption after deductibles and waiting periods. Read exclusions and evidence requirements. Insurance does not restore a missed customer relationship.

Shared infrastructure changes who carries risk

An industrial park can provide power, water, security and logistics. Ask whether the park owns generation, buys from the grid or passes utility interruptions through. Service levels and remedies belong in the lease.

A dedicated power project can anchor several plants. It needs creditworthy buyers, fuel or renewable resources, grid or private-wire permissions and a tariff that funds operation. One buyer's failure can affect the others.

Public guarantees can lower finance cost and transfer risk to the state. Disclose contingent liability and performance conditions. Cheap power produced through an opaque subsidy can become fiscally unstable.

Regional power pools can improve resource sharing, subject to transmission and payment discipline. A cross-border contract still needs local delivery capacity.

Put power before incentives

A tax holiday helps after taxable profit. Reliable power affects the first unit. Governments evaluating industrial projects should compare the value of fiscal concessions with grid, skills and logistics support.

Connection queues need transparent rules. A politically favoured plant can consume capacity needed by existing users. Publish allocation, customer contribution and expected network benefit.

Tariffs should reflect cost and policy choices with clear eligibility. An industrial discount funded by households or public debt has a distribution effect. Measure jobs and output delivered against support.

Training needs to include electrical safety, maintenance and energy management. Imported equipment without local service can extend outages while a specialist travels.

Report the operational result

After commissioning, publish grid and backup energy, outage hours, lost output, power cost per unit and safety incidents where appropriate. Compare with the investment case. Explain changes in production mix.

The IEA's 600-million estimate gives scale to the access deficit and the industrial opportunity. It should not appear as background decoration in a factory announcement. At project level, electricity has a feeder, a bill and a failure time.

Sources

• International Energy Agency, 6 October 2025: Stepping Up the Value Chain in Africa