TLDR;
Contents
- Tesla applies for Ofgem license to supply electricity to UK homes and businesses.
- Application follows steep EV sales slump in Europe, with Volkswagen overtaking Tesla in the region.
- Tesla Electric could replicate Texas model offering cheaper charging and energy resale.
- UK renewables push and government incentives may aid Tesla’s market entry.
Tesla is moving to extend its influence beyond the automotive industry and into the UK’s electricity market.
The company has applied to the UK’s Office of Gas and Electricity Markets (Ofgem) for a license to supply power to homes and businesses in England, Scotland, and Wales.
The filing was submitted by Andrew Payne, head of Tesla’s European energy operations. If approved, Tesla could launch its electricity supply business as early as next year, competing with some of Britain’s most established energy providers.
Building on the Texas Energy Model
Tesla Electric, the energy arm of the company, has already been tested in Texas with promising results. There, customers can charge their electric vehicles at lower rates and even sell surplus energy from solar panels and Powerwall batteries back to the grid.
Replicating this model in the UK could offer significant advantages. Tesla already has more than 250,000 EV drivers in Britain and a growing number of homes equipped with its solar and battery technology , providing a ready-made customer base for energy supply services.
Energy Pivot Amid EV Sales Slump
Tesla’s push into the UK energy market comes during a challenging period for its European automotive business. EV registrations fell 60% in the UK and 55% in Germany in July, contributing to a 33% drop in sales across Europe in the first half of 2025.
Volkswagen has overtaken Tesla as the region’s top-selling EV manufacturer, enjoying a 78% year-on-year surge in sales. Competition is intensifying from both established carmakers and aggressive Chinese entrants like BYD. Analysts suggest Tesla’s shift into energy is a strategic move to counter declining vehicle sales and safeguard revenue growth.
Renewable Energy Push Offers Opportunity
The UK electricity supply market, projected to reach £52.1 billion by 2025, is dominated by just 35 active suppliers. However, government policies strongly favor renewable energy adoption.
Current measures include a £4 billion budget for solar panel installations and a 0% VAT incentive for residential renewable energy systems.
Tesla’s integrated approach positions it uniquely against traditional suppliers. Its ability to deliver energy services directly to households that already use Tesla hardware could prove a significant competitive edge.
If the license is granted, British consumers could soon see the Tesla name not only on their cars but also on their energy bills, marking another bold step in the company’s mission to accelerate the transition to sustainable energy.
