EDF / 2018 Reference document

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ENVIRONMENTAL AND SOCIETAL INFORMATION – HUMAN RESOURCES EDF's Corporate Social Responsibility Goals

3. Improvement in the efficiency of existing assets In Belgium, work on the Ghent Ham boiler has optimised its emissions. ■ As part of its “better plan”, EDF Energy aims to lower its emissions to 50 ■ gCO 2 /kWh in order to maintain its position as UK’s leading low-carbon producer. EDF Energy intends to make strategic investments in renewable energies and nuclear power in order to reach this ambitious target by 2032 (1) . Maintaining its position as a leader in renewable energies See section 1.3.2.2 “Very low carbon generation”. Relying on nuclear power, the cornerstone of EDF’s low carbon strategy EDF’s nuclear power contributes to carbon efficiency in France and Europe. While ■ it is difficult to estimate the exact CO 2 emission savings in France, the average emissions from EDF's electricity generation are about 17 times lower than that of the sector in Europe (2) . The integration of a growing number of intermittent renewable sources of energy ■ into the electricity system requires flexible means of generation. climate change priorities into its investment strategy and policy Climate change represents a major financial challenge for EDF. In the context of its investment policy, EDF uses medium-long term scenarios that include carbon (3) prices enabling it to assess the profitability of future investments and plan the Group’s strategy. Financial commitments are scrutinised in line with the CAP 2030 (4) strategy and commitments made by the Group, including the 2 degree decarbonisation objective. Scenarios including a high carbon price enable the Group to focus its investments on low-carbon assets, increasing the profitability of its largely low-carbon generation facilities. The description of the scenarios used in this respect, as well as their consequences are confidential. Generating a comprehensive GHG report Although the Group historically publishes its direct CO 2 emissions, since 2011 EDF has provided annual GHG reporting which also covers its indirect emissions (scopes 1, 2 and 3) thus going above and beyond its regulatory obligations. Since 2013, a gradual initiative has been in place to carry out GHG reporting at Group level, using a harmonised methodology based on the GHG Protocol Corporate Standard. The work undertaken gives a good idea of the direct and indirect emissions of the Group as a whole. Direct emissions by the EDF group are almost all caused by fossil-fuelled electricity generation. In 2018, they amounted to around 35 million tonnes of CO 2 , with very few other sources of direct emissions. Indirect emissions are higher than direct emissions, given the electricity generation decarbonisation policy and the relatively low level of direct emissions: most indirect emissions come from the combustion of gas sold by EDF, the electricity purchased to

serve end-customers, upstream fossil and nuclear fuels used in the power plants, and the emissions associated with the construction of power plants. Other indirect emissions, such as emissions associated with purchasing goods and services, employee travel and electricity consumed for own use, or emissions associated with the Group's investments in non-consolidated assets, are, proportionally, very limited. Involving employees in the fight against climate change In terms of employee compensation, EDF incorporates performance indicators that participate in its climate actions. This is the case for executive variable compensation, which is partly tied to the nuclear fleet's availability, since the latter does not generate direct CO 2 emissions. It is also the case of one of the profit-sharing criteria that promotes the use of digital tools during meetings rather than requiring employees to physically attend (5) . 3.2.1.2.2.2 Helping customers consume less, more efficiently (6) and contributing to the process of removing carbon from the economy through low-carbon electricity (7) See section 3.2.4 “Committed to helping each customer consume better”. 3.2.1.2.2.3 Involve our stakeholders in climate action See particularly section 3.1.1.2.2 “Stakeholder panels”, section 3.1.3.3.3 “Expertise from sustainable development partnerships” and section 3.1.3.3.5 “Sustainable Development (SD) Training and Awareness Raising”. Governance of climate change 3.2.1.2.3 The Board of Directors regularly reviews the opportunities, risks (in particular those related to climate change), their impact on the Group's strategy and the activities and the measures taken as a result (8) . Regarding the consideration of climate change by Company management: the Executive Committee annually reviews the prospective balance sheet of ■ emissions within the scope of the goal (CSRG no. 1) and its compatibility with the Group's decarbonisation path; the Sustainable Development Department ensures operational follow-up, in ■ relation with the Corporate departments and subsidiaries concerned, by relying on the Sustainable Development Committee (SDC) and the Environmental Management System (EMS). The Sustainable Development Department also contributes to the management of the medium-term plan (see section 3.1.3 “Governance of sustainable development”); the CSR Committee (see 3.1.3.1 Governance of sustainable development) ■ ensures the strategic management of CSR issues including climate change and reports on its activities to the Group's Executive Committee at least once a year. Reports on its work are sent to the Board of Directors.

(1)

It should be noted that the previous objective of less than 100 gCO 2

/kWh was achieved

17 gCO 2 (2) In addition to other commodities and regulatory variables; for a description of the time-frames considered, see section 2.1 “Specific risks to which the Group is exposed”. (3) This is done within EDF’s commitment Committee. (4) Moreover, from 2019, the evaluation of managers will include ESG goals (Environment, Social, Governance). (5) The materiality matrix identifies energy efficiency as one of its key priorities (materiality issue no. 10 Energy efficiency). This refers to services aiming to control electricity (6) consumption (specifically using digital energy efficiency solutions) and awareness-raising initiatives carried out in order to promote moderate use of electricity. This priority also refers to the optimisation of grid output. Refers to the use of electricity instead of fossil fuels, and specifically to the development of electric mobility, new electric infrastructures and services contributing to sustainable (7) cities, and to the increased market share in heating. See section 4.2.2.3 "Powers and duties of the Board of Directors". (8) /kWh for EDF to be compared to 299 gCO 2 /kWh EU28 (CO 2 EMISSIONS FROM FUEL COMBUSTION, International Energy Agency, 2018, data for 2016.

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EDF I Reference Document 2018