Ofgem has granted Tesla Motors with an electric generation licence that hints at its ambitions to expand as an energy provider in the UK.
The licence means Tesla's energy plans, which have not been officially announced, will comply with UK regulations around electricty generation should it take the step to launch its Tesla Energy business in the UK.
Tesla has been rumoured to be interested in establishing a gigafactory to manufacture batteries at a facility in Bristol and is also rumoured to be planning a virtual power plant in the UK using its autobidder platform.
Autobidder is a software platform that provides independent power producers, utilities and even businesses and homes that have battery storage the ability to sell and trade energy back to the grid in real-time.
A virtual power plant can aggregate energy assets like vehicle batteries that can be grouped together and used like a power station.
Tesla already has products that use battery storage like its Powerwall and Powerpack that are used for home or business energy.
A Tesla gigafactory would manufacture battery cells, modules, and other components aimed to reduce costs, ensure a stable supply, and expand Tesla’s business accordingly.
Tesla’s current gigafactory in Nevada produces Model 3 electric motors and battery packs, in addition to Tesla’s energy products, Powerwall and Powerpack.
Tesla currently produces more batteries in terms of kWh than all other carmakers combined.
With more Gigafactories in play, Tesla’s cost of battery cells will decline through economies of scale and this will in turn reduce the cost of its EVs.
In a UK car sales market that was down 89% in May, Tesla's Model 3 emerged as the best selling vehicle, outselling models like the Vauxhall Corsa, Ford Fiesta and Mercedes-Benz A-Class.