EDF / 2018 Reference document

FINANCIAL STATEMENTS Operating assets and liabilities, equity

Details of changes in provisions for the back-end of the nuclear cycle, decommissioning and last cores are as follows:

Other movements (2)

Discount effect (1)

Notes

31/12/2017

Increases Decreases

31/12/2018

(in millions of euros)

Provisions for spent fuel management

29.1.1

10,786

488

(986)

651

(241)

10,698

Provisions for waste removal and conditioning Provisions for long-term radioactive waste management Provisions for the back-end of the nuclear cycle

29.1.2

726

10

(29)

43

1

751

29.1.2

8,814

38

(231)

826

399

9,846

20,326

536

(1,246)

1,520

159

21,295

Provisions for nuclear plant decommissioning Provisions for last cores

29.1.3 29.1.4

14,920

52

(138)

752

399

15,985

2,387

-

-

97

42

2,526

Provisions for decommissioning and last cores

17,307

52

(138)

849

441

18,511

PROVISIONS RELATED TO NUCLEAR GENERATION

37,633 39,806 The discount effect comprises the €1,534 million cost of unwinding the discount, and the €835 million effect of the change in the real discount rate in 2018, (1) which were recorded in the income statement for provisions with no related assets (cost of unwinding the discount). Other movements mainly include: (2) - reclassification of the provision for long-term radioactive waste management previously included in the provision for spent fuel management (€(298) million); - the €718 million effect of the change in the real discount rate at 31 December 2018 for provisions with related assets. 588 (1,384) 2,369 600

6.

Concerning non-EDF installations: EDF, COGEMA (now Orano Cycle) and the French Atomic Energy Commission ■ (Commissariat a l’Energie Atomique or CEA) signed an agreement in December 2004 which transferred the management and financing of final shutdown, decommissioning and waste recovery and reconditioning for the UP1 reprocessing facility at Marcoule to the CEA. In return, EDF paid the CEA a one-time financial contribution covering its full share of the cost of outstanding operations, while remaining the owner of its final waste and bearing only the transport and storage costs; EDF, AREVA and AREVA NC (now Orano Cycle) signed two agreements in ■ December 2008 and July 2010 defining the legal and financial terms for the transfer to AREVA NC of EDF’s contractual obligations regarding its financial contribution to the dismantling of La Hague installations and the recovery and conditioning of waste. In application of those agreements, EDF paid AREVA NC a one-time financial contribution covering its full share of the cost of outstanding operations, while remaining the owner of its final waste and bearing only the transport and storage costs. 29.1.1 EDF’s currently adopted strategy with regards to the fuel cycle, in agreement with the French State, is to process spent fuel and to recycle the separated plutonium in the form of MOX fuel (Mixed OXide of plutonium and uranium). The quantities processed by Orano at the request of EDF, totalling approximately 1,100 tonnes per year, are determined based on the quantity of recyclable plutonium in the reactors that are authorised to load MOX fuel. Consequently, provisions for spent fuel cover services associated with the following: removal of spent fuel from EDF's generation centres, as well as reception and ■ interim storage; processing, including conditioning and storage of recyclable matter. ■ The processing expenses included in these provisions exclusively concern spent fuel that can be recycled in existing facilities, including the portion in reactors but not yet irradiated. Expenses are measured based on forecast physical flows at the year-end, with reference to the contracts with Orano which define the terms for implementation of the framework agreement for the period 2008-2040. The most recent of these agreements, signed on 5 February 2016, covers the period 2016-2023. In 2018 the Board of Directors approved resumption of recycling of uranium from reprocessing (which was suspended in 2013 pending availability of a new industrial Provisions for spent fuel management

schema), with loading of the first fuel assemblies scheduled for 2023, subject to technical adaptations and the necessary authorisations from the Nuclear Safety Authority. The corresponding contracts were signed with the respective suppliers in the second quarter of 2018. The portion of the provision for spent fuel management relating to uranium from reprocessing will be recovered once all the industrial, regulatory and economic conditions for resumption of uranium recycling have been fulfilled, but EDF has no control over fulfilment of some of these conditions (currently, no advance timetable has been set). These provisions also cover long-term storage of spent fuel that cannot currently be recycled in existing installations: plutonium fuel (MOX) or uranium fuel derived from enriched processing, and fuel from Creys-Malville and Brennilis until fourth-generation reactors become available. Following publication of the ministerial order of 28 December 2018 amending the order of 21 March 2007 on secure financing of nuclear expenses, in 2018 the provision covering interim storage of waste from spent fuel processing has been reclassified as part of the provision for long-term radioactive waste management (this concerns an amount of €298 million). Provisions for waste removal 29.1.2.1 and conditioning The provisions for waste removal and conditioning are reported separately from 1 January 2017. They cover the following future expenses for radioactive waste resulting from operations or decommissioning (apart from spent fuel): characterisation and conditioning of waste; ■ interim storage of waste. ■ Equipment assembly for the conditioning and intermediate storage facility for radioactive waste (Installation de conditionnement et d’entreposage des déchets activés – ICEDA) was completed in December 2018 and pre-service testing is currently in process. Information on the identification of EIP equipment (equipment that is important for protection of interests) has been added to the commissioning permit application (DAMS) which has now been sent to the ASN. The objective is to open the storage facility in September 2019. Provisions for waste removal and conditioning – Provisions for long-term radioactive waste management 29.1.2

381

I Reference Document 2018