Tesla takes first steps to become an electric utility, starting with the UK

Tesla's Megapack as a utility grid. (Credit: Tesla)

It appears that Tesla has taken a significant step forward in its efforts to become a full-blown energy provider. Just this past Tuesday, Tesla Energy production sales director Evan Rice applied the UK’s gas and Electricity Markets Authority, the country’s energy regulator, for a license to generate electricity.

Tesla did not disclose why it is applying for such a license, though an industry insider cited by The Telegraph has stated that the company may be planning on introducing its Autobidder platform in the UK. Tesla developed Autobidder to function as a real-time trading and control platform that enables power producers to monetize their battery assets. 

Autobidder is already in use in one of Tesla’s most notable battery storage installations. According to the electric car maker’s official page for its Autobidder platform, the system is currently operating at the Hornsdale Power Reserve in South Australia, one of the world’s biggest battery installations. The big battery in Hornsdale has been a runaway success since it was deployed, providing quick, stable backup to the grid and helping residents in the region save money on their power bills. 

Tesla, for its part, has declined to comment on why it has decided to apply for a license to generate electricity in the UK. That said, Martin Young, a power analyst at Investec, stated that it makes sense for Tesla to expand its business. “If you are a manufacturer of electric vehicles, you’d think they’d be interested in offering an energy plan too,” he said. 

Tesla’s recent strategies in the UK bode well for the eventual expansion of the company’s Energy business. Tesla Energy has, for the most part, taken a background role compared to the company’s electric car division. Nevertheless, Tesla Energy has a lot of untapped potential. A portion of this is because battery storage systems, including the grid-scale Megapack, are notably simpler products than electric vehicles, and they have the potential to be profitable. 

While Tesla Energy has been an understated business for some time now, the division has made substantial progress since the year began. Despite the outbreak of the coronavirus and the eventual halt to the operations in Gigafactory New York and Gigafactory Nevada, Tesla Energy was able to achieve a series of milestones nonetheless. 

These included the production of 4 MW worth of Solarglass Roof V3 every week, which is enough to accommodate 1,000 home installations weekly. The demand for the Megapack, a 3 MWh grid-scale battery, is also above the company’s capability to manufacture it. Furthermore, the 100,000th Powerwall installation was also conducted in the first quarter, partly thanks to about 40% of Tesla Solar customers purchasing the home battery unit.

Simon Alvarez: Simon is a reporter with a passion for electric cars and clean energy. Fascinated by the world envisioned by Elon Musk, he hopes to make it to Mars (at least as a tourist) someday.
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