Energy regulator Ofgem has granted Tesla a licence to supply electricity to homes and businesses across England, Scotland and Wales, opening the door for Elon Musk’s company to enter the British energy market for the first time.
The approval allows Tesla to sell electricity directly to domestic and commercial customers, mirroring the model it already operates in Texas under the Tesla Electric brand, where the company positions itself as a provider of low-cost sustainable power for homes, electric vehicles and local communities.
The licence covers electricity supply only. Tesla will not be able to offer combined gas and electricity deals, meaning any household that signs up would need to maintain a separate arrangement with a gas supplier.
The move builds on Tesla’s existing energy infrastructure ambitions. In Texas, the company runs a virtual power plant scheme that lets Tesla owners charge their vehicles at low cost and then sell electricity stored in Powerwall home batteries back to the grid. A comparable Powerwall scheme already operates in Britain, though currently through Octopus Energy rather than Tesla directly. The new licence gives Tesla the ability to bring that relationship in-house.
Tesla has not disclosed how many Powerwalls it has sold in the UK, though its electric vehicle presence in the country is substantial, with more than 250,000 cars sold to date. However, that footprint has been shrinking. UK sales fell 37 percent in February compared with the same month last year, dropping from 3,852 to 2,422 vehicles, according to figures from the Society of Motor Manufacturers and Traders. Tesla’s current UK market share stands at 1.34 percent — behind Chinese rival BYD at 2.64 percent and BMW at 5.43 percent.
The decline has been driven by a combination of intensifying competition in the electric vehicle sector and a backlash from buyers linked to Musk’s political activities. His public support for Donald Trump, his role leading job cuts at the US government efficiency initiative known as Doge, and a series of controversial interventions in European politics — including expressing support for Germany’s far-right AfD party and making comments about UK politicians and the grooming gangs scandal — contributed to falling demand across Britain and mainland Europe.
Tesla attempted to address the sales slump in December by launching a lower-priced version of its Model 3 in Europe, with Musk arguing at the time that a more affordable option would broaden the company’s customer base.
Whether the energy licence provides a new commercial foothold in Britain while its car sales remain under pressure will likely depend on how aggressively Tesla moves to build out its electricity offer — and whether British consumers prove willing to separate their views on Musk from the products his company sells.
