EDF / 2018 Reference document

1.

PRESENTATION OF EDF GROUP Group strategy

1.3.2

PRIORITIES OF THE CAP 2030

on 10 October 2018 of its Electric Mobility Plan, which sets out concrete targets for four of the Group's markets (France, United Kingdom, Italy and Belgium). Electricity storage is a key area of innovation for energy transition. The Group's Electricity Storage Plan, announced on 27 March 2018, provides for the development of 10GW of new storage facilities in the world by 2035 (6GW of large-scale storage, 4GW of dispersed storage), increasing the Group's storage capacity by then to 15GW. R&D and innovation The EDF group is intensifying research and development in storage, solar energy, electric mobility, smart electricity systems and sustainable local energy solutions (smart cities). It is also increasing its innovation efforts to meet the expectations of its customers and offer solutions and services adapted to the new consumption patterns and based on increasingly digital means of communication. These efforts contribute to the development of the Group's projects. With “EDF Pulse Expansion”, an incubator for in-house and external projects, EDF is testing and exploring new business sectors, creating new growth drivers for the Group and offering customers a new range of innovative products and services. Lastly, the deployment of the Linky (1) smart meters, the development of renewable energies and electric mobility, and the emergence of cities actively involved in their local energy choices, are putting distribution networks at the forefront of the transformation of the electricity system. The distributor thus plays a key role as facilitator of the energy transition. In this respect, Enedis and EDF have established with the national federation of licensing authorities (FNCCR) and the association France Urbaine, a new draft concession contract for the public distribution of electricity and the supply of electricity at regulated tariffs, in order to modernise relations with the concession contracting authorities. This contract integrates regional changes and the energy transition, while retaining the principles of the French concessionary model: public service, regional solidarity and nationwide optimisation. Very low carbon generation: nuclear 1.3.2.2 and renewable energies EDF’s nuclear facilities are already giving France a major lead compared to its neighbours in terms of curbing greenhouse gas emissions, while still ensuring a highly competitive electricity cost. To remain the leader in very low carbon electricity generation, the EDF group is intensifying the development of renewable energies while ensuring the safety, performance and competitiveness of the existing nuclear facilities and New Nuclear investments. Consolidation of the asset base Achieving the very low carbon generation goal starts with the consolidation of the hydropower and nuclear asset base: EDF regularly invests in hydropower concessions in order to combine economic, ■ energy and environmental performance, and will propose solutions to strengthen hydropower generation; EDF is investing in order to obtain approval to continue the operation, under the ■ highest safety conditions, of the French nuclear fleet beyond 40 years, now that its economic and carbon competitiveness has been demonstrated. In this context, EDF has undertaken the “Grand Carénage” programme of continued operation, without prejudice to approvals which will be granted on a unit-by-unit basis by the ASN (French Nuclear safety authority) after each ten-year inspection. In the United Kingdom, investments are also being made to extend the operating life of the entire UK nuclear fleet. Lastly, the EDF group continues to invest in preparations for the decommissioning of the nuclear fleet and for waste management in France and the United Kingdom.

STRATEGY To be a responsible and efficient electricity producer that champions low carbon growth: this is the goal of the EDF group, driven by the CAP 2030 strategy. This is broken down into three priorities: proximity to customers and local communities; ■ low carbon generation by rebalancing the mix between nuclear and renewable ■ energy; international expansion. ■ Several strategic workshops have been conducted since 2015, translating each of these three strategic priorities. This goal will also be achieved through a transformation programme based on simplification, innovation and digital technology, accountability and performance, human ambition and skills. As a part of CAP 2030, the EDF group has made a commitment to six Corporate Responsibility Goals (see section 3.1 “EDF's commitments in the area of sustainable development”). In particular, engaged in combating global warming with one of the lowest carbon generations in Europe, EDF took the commitment in 2018 to reduce its direct CO 2 emissions by 40% by 2030 (with a target of 30 million tonnes in 2030 compared with 51 million tonnes in 2017) and to be in keeping with the goal of carbon neutrality by 2050. Proximity to customers and local 1.3.2.1 communities In order to support customers and local communities in their energy transition, the EDF group aims to create new competitive decentralised solutions, new customised low-carbon energy services and smart grids, based on three levers: The development of energy efficiency solutions and new digital services for its customers EDF deploys and develops its “EDF Solutions énergétiques” brand, created in 2017, to promote its range of solutions offered by its specialised subsidiaries (Dalkia, Citelum, IZIVIA, Edelia, Netseenergy, Fenice). Low-carbon heating networks, smart lighting, waste recovery, electric mobility: the range is complementary, innovative and meets the new challenges of local communities and businesses alike. For example, at the local level, with the Citelum's intelligent platform MUSE©, the “Dijon Métropole” urban area will benefit from the centralised management of all its equipment and public services. In Belgium, the consortium led by Citelum with EDF Luminus, DIF and CFE was awarded a Public Private Partnership for the smart lighting of major motorways in Wallonia. As for residential customers, the EDF group offers and continues to develop a range of digital energy services, marketed in France and in the “core European countries” (United Kingdom, Italy, Belgium). For example in 2016, the launch of Sowee (a subsidiary offering innovative connected home products and solutions, that was further diversified in 2017 and 2018) reflects the EDF group’s commitment to meeting the new expectations of its customers, especially with regard to sustainable wellbeing in the home. Existing offerings and customer relations will also continue to be enriched by new digital technologies and features, facilitated in particular by smart meter systems deployed in several countries. Support to the development of new efficient uses of electricity to replace fossil fuels (electric mobility, self-consumption, heat pumps, low carbon housing, etc.) The EDF group aims to be a key player in self-consumption in the French market and is highly committed to the development of electric mobility with the announcement

Linky is a project carried out by Enedis, the distribution network operator, managed independently. For the sake of brevity, all further mentions of Linky in the rest of the (1) document do not specify that it is a project led by Enedis.

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EDF I Reference Document 2018