Tesla plans to turn homes in UK into virtual power plants. Here's how

Tesla Inc. is offering an electricity tariff that combines solar panels and a battery, turning British households into virtual power plants.

In order to qualify for the cheapest Tesla Energy Plan, customers will already need to own a Tesla electric vehicle and home charger, plus install solar panels and a Powerwall battery. The company said the tariff offers 75% savings compared to other suppliers.

Renewable power supplier Octopus Energy Ltd. has teamed up with Tesla. The deal means homes can generate, store and return solar energy to the grid during peak times. Import and exports of electricity will be determined by software and will happen automatically based on energy-use patterns, solar generation forecast and wholesale energy prices.

The UK already has several tariffs designed for electric vehicles that allow electricity to flow to the grid in both directions. This is the first that incorporates a household battery and solar panels as an additional power source.