Tesla Electric moves to enter UK domestic power market 2025

Elon Musk’s Tesla is on the brink of a significant move into the UK energy sector. The renowned US electric car manufacturer has officially applied to the Great Britain energy regulator Ofgem for a licence to supply electricity to homes and businesses. If approved, the business will operate under the brand Tesla Electric, setting the stage for direct competition in the British energy supply market from 2026.

The application, made by Tesla Energy Ventures, the company’s Manchester-based subsidiary, signals a new chapter in Tesla’s UK ambitions. The application bears the signature of Andrew Payne, European head of Tesla’s energy division, who oversees a team of over 60 specialists. The brand’s UK car sales may be slowing, but its diversification into electricity supply highlights a broader strategy designed to create a Tesla-centric energy ecosystem for both existing and prospective customers.

While this new licence will not cover households on dual-fuel contracts—since Tesla is seeking an electricity-only licence—the offering is anticipated to appeal particularly to owners of Tesla products such as electric vehicles and home battery systems. Tesla has already seen strong sales in the UK for its home storage batteries, known as Powerwalls, which can be charged using solar panels or from the grid during off-peak times. The company also markets home charging solutions for electric vehicles, a synergy that underpins the logic of this expansion.

The move comes as Tesla faces declining car sales in the UK and Europe, reflected by a sharp fall of 60 per cent in new Tesla registrations in the UK last July compared to the same period last year. Market share for Tesla cars dropped to just 0.7 per cent, with sales figures for 2025 so far down by 7 per cent. The timing coincides with increased scrutiny and criticism of Musk’s political affiliations and interventions across several European countries.

Although Tesla’s plans for a UK energy supply business have been widely speculated since a job listing appeared two years ago for a head of operations, the current application for a supplier licence marks its most concrete step yet. Success in Texas, where Tesla operates an electricity supplier offering discounted car charging and payments for surplus solar or battery-stored energy fed back to the grid, provides a potential blueprint for the UK initiative.

Tesla received a UK licence to generate electricity in 2020, laying the groundwork for the latest push into domestic power supply. With Ofgem’s decision expected within nine months, rival suppliers and industry watchers will be closely following Tesla’s next moves as it aims to bring its energy model to British households and businesses.