Telecom · Data Centres / Digital Infrastructure
Independent Audit of a Hyperscale Data Centre Business Case
An illustrative engagement: auditing a global operator's entry case for a first African campus, replacing the deterministic demand curve with a probabilistic one, and stress-testing the returns against FX and power-tariff shocks.
Challenge
A global data centre operator's internal case for a Lagos campus rests on a straight-line demand curve, a fixed long-dated PPA, and an assumption that the local currency will stay inside a narrow band. The investment committee has already rejected one version of the paper and wants an independent audit before the second submission.
Solution
We rebuild the demand side from anchor-tenant interviews and turn it into probability-weighted absorption curves rather than a single line. We run FX shocks calibrated to recent devaluations, price a power-tariff step-up scenario against the utility's history, and quantify the value of a partial-guarantee wrap on the offtake against those exposures. Every line the original case left as a point estimate is replaced with a distribution.
Results
The audit surfaces a material capex overstatement in the phase-one build and a materially thinner downside IRR than the base case had shown. The committee approves a phased build with an explicit trigger for phase two tied to signed absorption, a partial-guarantee wrap on the offtake, and an FX-linked step in the anchor-tenant contracts.
Future Applications
The phased-with-trigger structure and the FX-stress framework become the operator's standard template for African market entries, and the demand-probability model is re-used for a second campus in West Africa.
