By Nicholas Earl
The energy market could be shaken up by a bold challenger, with Elon Musk’s Tesla unveiling plans to launch a new household supplier in the UK.
The electric vehicle giant already runs an energy supply business in the US, and now aims to sell electricity to British households – according to a recent job listing.
Tesla Electric supplies electricity to customers that own Tesla products such as cars or batteries.
The advert for a head of operations – which was first reported byThe Daily Telegraph – called for a new executive “with a healthy scepticism of the status quo” to manage the company’s entry into the UK’s domestic market.
It said that Tesla Electric would be able to “support the transition of the entire electricity grid to 100 per cent renewables.”
Tesla Electric will look to lure in customers with the option to store electricity when it is cheap, and later sell it back to the grid when market prices are higher – allowing customers to ease their bills.
This would be an option for customers who own a Tesla powerwall battery (a home storage unit), solar panel or one of its cars.
Tesla launched its first household supply deals in Texas last year, offering drivers who bought its Model 3 car between May and June a year of free, overnight vehicle charging at home when they signed up with Tesla Electric as their retail electricity provider.
After the first year, drivers would then default to Tesla’s standard overnight charging rate of $1 per day.
However, the service as outlined would not be permitted under UK regulations – asthe universal service obligation means companies can’t act as a retailer without offering a tariff to everyone, so Tesla would need a product for non-powerwall owners.
Adam Bell, ex-head of energy at the department for business, energy and industrial strategy, and now head of policy at consultancy group Stonehaven, was unconvinced the service could work as a conventional retail supplier.
He said on Twitter: “It’s likely that Tesla has made this commitment without really thinking through this plan. However, I can see a route for making it work – but it’s not an energy retailer. Tesla could conceivably aggregate the output of powerwalls at a given grid supply point, register it in the balancing mechanism, and sell the power that way. They could then pay the powerwall owner directly with these returns.”
Tesla first waded into the British energy market three years ago – applying to Ofgem to be an electricity generator, which granted them a licence in June 2020.
Ofgem granted its licence in June 2020.
This is not Musk’s first pivot to the UK this year, having previously made plans to open an insurance firm in London.
