Tesla, the well-known electric vehicle and energy firm founded by Elon Musk, is preparing to enter the UK electricity market by supplying power directly to homes and businesses.
The Texas-based company submitted an application for an electricity supply licence to the British energy regulator Ofgem at the end of July 2025. This request came from Tesla Energy Ventures Limited and was signed by Andrew Payne, who oversees Tesla’s energy operations across Europe, marking the company’s first step towards providing electricity in the UK.
If the licence is approved, Tesla would begin competing with established energy suppliers such as EDF, British Gas, E.ON Next, and Octopus Energy, potentially starting operations by 2026.
The licence assessment process could take up to nine months, with public comments on the application closing in late August 2025. Tesla’s UK energy arm is based in Manchester, showing the company’s commitment to expanding its presence in Britain’s energy sector.
Although Tesla is primarily known for its electric vehicles, the business has also made significant strides in renewable energy technologies, developing solar panels and advanced battery storage systems. These products are part of Tesla’s overall strategy to offer integrated energy solutions.
In Texas, Tesla already runs Tesla Electric, an electricity supply service launched in 2022 that enables customers to optimise energy usage and earn rewards by selling surplus electricity back to the grid. Tesla Electric also provides subscription options allowing unlimited at-home charging for Tesla vehicles during off-peak periods—a feature that could appeal to UK consumers if implemented locally.
This energy supply initiative comes at a time when Tesla is encountering challenges within the European car market. Data from the Society of Motor Manufacturers and Traders showed that new Tesla registrations in the UK fell sharply by nearly 60% in July 2025 compared to the previous year, dropping from 2,462 units to just 987.
Germany experienced a similar downturn, with Tesla sales decreasing over 55% year-on-year in the same period. Competition is intensifying, particularly from Chinese manufacturers like BYD, coupled with reputational impacts stemming from Elon Musk’s controversial political affiliations and public remarks.
Tesla’s move into the UK electricity market could be seen as an effort to diversify income beyond vehicle sales by bundling energy services with EV ownership. Potential offerings might include discounted or subscription-based EV charging and incentives for customers to feed excess energy back into the grid, following Tesla’s successful model in Texas.
Tesla’s bid to secure an electricity supply licence in the UK illustrates its ambition to disrupt the traditional energy market with innovative and customer-focused solutions, even as it faces considerable challenges in the European electric vehicle sector.