Every morning, across thousands of businesses in Lagos, the first decision of the day has nothing to do with customers, strategy, or product. It has to do with electricity. Is there power from the grid? How much diesel is left in the generator? Can we afford to run it for a full shift, or do we ration? These questions come before the shop opens, before the factory floor hums, before the first email is sent. They come before everything, because without an answer, there is nothing.
In software engineering, there is a concept called a dependency, i.e., something your system needs in order to function. Dependencies form trees. Your application depends on a framework, which depends on a runtime, which depends on an operating system, which depends on hardware. If any node in the tree fails, the nodes above it fail too. The lower you go, the more catastrophic the outcome when it breaks.
Electricity is not this tree. It is beneath it. It is the ground the tree is planted on. In mathematical convention, when something precedes the first element, we call it zeroth. Energy is the zeroth dependency - the one so fundamental that it is rarely written down, almost never analysed with the seriousness it deserves, and only noticed when it disappears.
This essay is about what happens when you take that seriously. When you stop treating electricity as just background infrastructure and start seeing it as the precondition for every other economic activity. The argument is simple, and I think close to inarguable: until you understand energy as the product-before-the-product, you do not really understand how economies or businesses work.
The Dependency Nobody Declares
There is a particular kind of software bug that experienced engineers dread: the undeclared dependency. Your application works on your machine because some library happens to be installed, some environment variable happens to be set, some background service happens to be running. None of these are in the manifest. When the code ships to a new environment and breaks, nobody knows why because the failure is in something nobody thought to list. We invented containerisation to address this problem.
Energy is the undeclared dependency of all economic activity. Open any business plan, any startup pitch deck, any microeconomic model. You will almost never find energy treated as a foundational variable. It is assumed. It is a given. In the language of business, it is outside the business model. This is a mistake.
Consider the classical factors of production: land, labour, and capital. In practice, all three are downstream of energy. Capital equipment is inert without electricity to power it. Labour productivity collapses without lighting, air conditioning, refrigeration, or connectivity. Even land value is, in part, a function of grid access – a plot with reliable power is worth multiples of an identical plot without it. Energy does not sit alongside these factors. It sits beneath them.
Why, then, is it absent from most economic thinking? For the same reason oxygen is absent from recipes. Nobody writes “add oxygen” when describing how to bake bread, because in the context the recipe was written, the absence of oxygen is inconceivable. The recipe assumes a breathable atmosphere. Economic theories or business models, built largely in industrialised nations with mature grids, make the same assumption about electricity. The models are constructed in environments where power is as reliable as gravity.
The problem is that for a significant portion of the world – most of sub-Saharan Africa, large parts of South Asia and Latin America – the assumption is false. The atmosphere, so to speak, is not reliably breathable. When your most fundamental dependency is unreliable, everything built on top of it is intrinsically unreliable too, in ways that are difficult to see from the outside.
The Shadow Product
Anyone who has run a business in Nigeria knows a fact intimately; you are always running two businesses. The one you tell investors/customers about, and the energy company you are forced to operate underneath it.
A hospital in Lagos does not simply treat patients. Before it can treat a single patient, it must buy diesel, maintain generators, employ technicians to keep them running, negotiate with the local distribution company, install voltage regulators to protect sensitive equipment from power surges, and budget for all of this as a recurring operational expense that, in many cases, rivals rent. The hospital’s core competency is medicine. However, its first operational ‘competency’, the one that makes medicine possible, is power generation and management.
The same is true of factories, banks, telecom towers, cold storage facilities, data centres, supermarkets, schools, and corner shops. Every business in an unreliable-grid environment is, whether it acknowledges it or not, also in the energy business. This is what I mean by the shadow product: the thing you must produce, at considerable cost and effort, before you can begin producing the thing you actually sell.
The numbers are staggering when you add them up. Nigerian businesses collectively spend billions of dollars annually on self-generation. The Manufacturers Association of Nigeria has repeatedly reported that power costs account for 30%-40% of production costs for its members. SMEs – the segment that is supposed to drive employment and growth – are hit the hardest, because they lack the scale to amortise the fixed costs of backup power across large revenue bases, A small bakery and a steel mill both need generators. Only one of them can absorb the cost.
The monetary cost, large as it is, understates the real damage. The deeper cost is cognitive! Running a shadow product consumes management attention, operational bandwidth, and institutional energy that would otherwise go to the actual business. When your CEO is thinking about diesel procurement, they are not thinking about market strategy. When your operations team is managing generator maintenance schedules, they are not optimising production workflows. The zeroth dependency, when it is unreliable, doesn’t just impose a financial tax. It imposes an attention tax. Attention, unlike money, does not scale.
Reliability as an Invisible Subsidy
Let us turn the lens around. If unreliable power is a tax on developing economies, then reliable power is a subsidy to developed ones – an enormous , invisible, never-acknowledged subsidy.
The reason a startup in SF can consist of three engineers with laptops in a coffee shop is that somebody else already solved the zeroth dependency. The grid delivers power at 99.97% reliability. The lights are on. The Wi-Fi works. The coffee machine runs. None of this appears in the startup’s cost structure, because none of it is the startup’s problem. The founders can dedicate one hundred percent of their cognitive bandwidth to building their product, because zero percent is consumed by power management.
This is not a minor advantage. It is a foundational one. The entire mythology of Silicon Valley – the garage startup, the move-fast-and-break-things ethos, the lean operation that scales from nothing – depends on a precondition that is so thoroughly met, it has become invisible. You cannot move fast and break things if your generator just broke or you are waiting for a diesel delivery that may or may not arrive today.
The implication is that the gap between a Nigerian entrepreneur and a Bay Area founder is not just about capital, or market size, or access to talent, though all of those matter. It is that one of them must solve a problem the other does not even know exists. One of them is competing in a race while simultaneously laying the track. The other was born on a track that was laid a century ago.
This reframes the familiar narrative of “developing versus developed” in a way I think is more honest than the usual hand-waving about institutions and governance. Yes, institutions matter. However, electrification is not a consequence of economic development. It is a precondition. The historical record is emphatic on this point. Britain’s industrial revolution ran on coal-fired steam, then electricity. America’s industrial surge followed rural electrification. Germany, Japan, South Korea, China – every successful industrialisation story in modern history has the same opening chapter: first, solve energy. Everything else comes after.
The Cascading Failure
Most dependencies, when they fail, degrade the system. A delayed shipment slows production. A software outage disables a feature. A staff shortage reduces throughput. These are linear failures – proportional, contained, recoverable.
Energy failure is not like this. Energy failure is catastrophic and non-linear. When power goes out, it does not degrade your operation. It stops it. And the second-order effects cascade in every direction simultaneously.
The cold chain breaks. Vaccines spoil. Food rots. Medications that require refrigeration become useless. Data is lost or corrupted because servers shut down without clean power-off sequences. Telecommunications go dark as base station batteries drain. Security systems fail – cameras, access controls, alarms. Water supply ceases in any building that relies on electric pumps, which is most buildings above two stories. Traffic lights die. Intersections become sites of conflict and accidents. Hospitals lose ventilators, monitors, and surgical lighting. In the dependency graph, energy is the root node, and every other node is a direct child. Its failure propagates everywhere at once.
South Africa’s experience with load-shedding has made this viscerally clear. The country’s rolling blackouts, which at their worst reached Stage 6 – cutting over six thousand megawatts from the grid – have not merely inconvenienced the economy. They have restructured it. Businesses have re-organised around the blackout schedule. An entire secondary economy of inverters, batteries, solar panels, and generators has emerged. GDP growth estimates have been revised downward specifically to account for load-shedding. Crime spikes during outages. Water treatment plants fail. The cascading failure is not hypothetical. It is measured, documented, and ongoing.
Engineers have a term for a component whose failure brings down the entire system: a single point of failure. Good engineering demands redundancy for such components. The energy infrastructure in much of the world has no meaningful redundancy. In the Global South, the grid is usually unstable. When it fails, the backup is usually a diesel generator – which introduces its own failure modes: fuel supply, maintenance, capacity limits, emissions. The “redundancy” is another fragile system bolted onto the first one. It is turtles, all the way down.
The Zeroth Opportunity
There is a symmetry to the zeroth dependency that is worth stating plainly. If energy is the foundation upon which all other economic activity rests, then solving energy – making it reliable, affordable, observable, and clean – is the highest-leverage intervention available. It is the zeroth opportunity.
Every other ambition is gated by this one. Africa’s demographic dividend – the economic potential of a young, growing population – resolves or fails at the energy layer. YOU CANNOT INDUSTRIALISE WITHOUT POWER. You cannot build a digital economy without power. You cannot run modern healthcare, education, or logistics without power. The talent is there. The markets are there. The ambition is abundant. What is missing, in many places, is the precondition.
This is not a call for pessimism. It is an opportunity, an opportunity to build a new type of electricity infrastructure. Using Nigeria as a case study, our electricity infrastructure deficit should not be seen solely from the lens of being a constraint, but as a strategic opportunity. This is because the country does not yet have a fully built, reliable grid. Huge swathes of the country are not connected to the national grid. Therefore, it has room (unlike more stable and mature grids) to design a different architecture from the ground up. There is less sunk cost.
We can design a different energy architecture – one built around a coordinated backbone grid where necessary, but also around a patchwork of distributed energy resources, mini-grids, embedded generation, and local energy systems that can grow faster than a purely centralized model. In that sense, Nigeria does not need to choose between the grid and decentralised power; it can build a hybrid system in which the central grid provides bulk transfer, coordination, while decentralised assets provide resilience, speed of deployment, local reliability, and access expansion.
The state’s role is therefore to govern the overall architecture, standards, and interoperability of this mixed system, while creating the conditions for private capital to build and operate generation, mini-grids, solar systems, storage, and other distributed infrastructure, thereby turning what looks like underdevelopment into the chance to leapfrog toward a more modular, flexible, and adaptive electricity system than countries locked into old (centralised) grid models.