EDF / 2018 Reference document

PRESENTATION OF EDF GROUP Description of the Group's activities

Output (2) (TWh)

Reactors

Capacity (in MW)

% interest

Company-owned capacity (in MW)

2018 7.29 7.70 5.31 8.29 4.70 33.29

2017 7.83 7.27 4.89 9.11 4.70

Calvert Cliffs 1 Calvert Cliffs 2 Nine Mile Point 1 Nine Mile Point 2 (1)

908 881 620

100 100 100

908 881 620

1.

1,287

82

1,056

RE Ginna

576

100

576

TOTAL 33.80 CENG owns 82% of this unit (i.e. 1,056MW of the unit’s total capacity of 1,287MW). The 18% of Unit 2 of Nine Mile Point not owned by CENG belongs to the (1) Long Island Power Authority (LIPA). LIPA receives 18% of the capacity and electricity generated by Nine Mile Point Unit 2, in consideration for payment to CENG of its share of the costs incurred by the unit, and is responsible for its 18% share of the costs of dismantling the unit. CENG and LIPA are each required to provide specific funding for Nine Mile Point 2. These values correspond to the sum of the exact values expressed to one decimal place after rounding. (2) 4,272 4,041

The assets of EDF represented 2% of the US nuclear generation capacity and 0.4% of total electricity generation (2017 data). The principal competitors of CENG on this market are Entergy, AEP, Exelon, Dynegy and NRG. Regulations of the State of New York On 1 August 2016, the New York Public Service Commission (NYPSC) issued an ordinance establishing a new regulation, the Clean Energy Standard (CES), of which one of the aspects is aimed at the preservation of nuclear resources in the State of New York, by the recognition of their zero-carbon electricity generation environmental characteristics. The mechanism includes the creation of a programme of zero emission credits (ZEC: Zero Emission Credit) in order to preserve the low-carbon nuclear generation installations, which comply with the criteria determined by the NYPSC. The New York State Energy Research and Development Authority (NYSERDA) centralises the award of ZECs to eligible power plants via a 12-year contract, administered in six tranches of two years, with effect from 1 April 2017 until 31 March 2029. The payment of ZECs to eligible producers will be made on the basis of the number of megawatt-hour produced, subject to caps and minimum performance requirements. The price to be paid for the ZEC for each tranche will be determined administratively using a formula based on the social cost of carbon estimated by the federal government in 2016. This formula also includes downward adjustments related to price fluctuations in the energy market and capacity. For the first tranche (from 1 April 2017 to the end of March 2019), the price of a ZEC was fixed at $17.48 per MWh generated. For the following tranches, the price will be updated every two years. Each electricity supplier (“Load Serving Entity”) is required to purchase a ZEC volume consistent with its market share in the State of New York. Recovery of program costs from customers who benefit from regulated tariffs is included in their electricity bills. The NYPSC has established that Ginna and Nine Mile Point nuclear facilities are eligible for the ZEC program. On 18 November 2016, agreements for the sale of ZECs for Ginna and Nine Mile Point were signed with NYSERDA. During the 2018 fiscal year, CENG recognised $312.5 million for the sale of ZECs. Environmental groups filed a petition, aimed at invalidating the ZEC program, in a New York state court on 30 November 2016. The petition was amended on 13 January 2017. This petition contends that NYPSC is not empowered to set up this program, that it violated state environmental law, and that it violated certain technical provisions of New York State law on administrative procedures (SAPA). On 15 February 2017, CENG filed a motion to have this case dismissed. On 22 January 2018, the court dismissed the environmental claims and the majority of the plaintiffs from the case but denied the motions to dismiss with respect to the remaining five plaintiffs and claims, without commenting on the merits of the case. The case is now proceeding to summary judgment with the full record. CENG’s answers and briefs were filed on 30 March 2018. After briefing is completed, the court will decide whether or not to set the case for hearing. On 19 October 2016, a coalition of thermal energy generation companies filed a complaint before the New York federal district court against NYPSC, alleging that the ZEC program would violate certain provisions of the US constitution, and more specifically that it would interfere with regulatory requirements of the Federal Energy Regulatory Commission concerning wholesale tariffs and that it would constitute discrimination against competitors from other states. On 9 December 2016, CENG

filed a motion to intervene in the case and to dismiss the lawsuit. The State also filed a motion to dismiss. On 25 July 2017, the court granted both motions to dismiss. On 24 August 2017, the plaintiff appealed the decision to the U.S. Court of Appeals for the Second Circuit. On 27 September 2018, the U.S. Court of Appeals for the Second Circuit affirmed the lower court's dismissal of the complaint against the ZEC program. EDF Trading in North America 1.4.5.3.4.2 EDF Trading operates in the North American markets for electricity (including transmission rights), gas, coal and environmental products. EDF Energy Services is the commercial and industrial retail arm of EDF Trading and provides management and optimisation services to large-scale energy intensive commercial and industrial customers throughout North America (see section 1.4.6.3 “Optimisation and trading: EDF Trading”). EDF Renewables in North America 1.4.5.3.4.3 EDF Renewables, through its subsidiaries EDF Renewables North America, EDF Renewables Canada and EDF Renewables Mexico continued its expansion in North America, commissioning 272.6MW gross of wind, solar photovoltaic and biogas capacity in 2018. EDF Renewables Services manages wind and solar projects, both for the company’s own accord and on behalf of third parties (see section 1.4.1.5.3 “EDF Renewables”). Dalkia in North America 1.4.5.3.4.4 Dalkia, a wholly-owned subsidiary of the EDF group, is present in the North American energy services markets (local management of energy and energy efficiency) with 521 employees. Dalkia operates through its companies Dalkia Wastenergy in Canada, Groom Energy Solutions and Aegis Energy Services in the United States (see section 1.4.6.1.1 “Dalkia”). Research & Development 1.4.5.3.4.5 EDF has an R&D and Innovation team (EDF Innovation Lab) located in Los Altos, California, which assists EDF group with research, development and innovation as well as with its development in the United States (see section 1.6.3 “International business and partnerships”). To this end, EDF Innovation Lab analyses new technologies and start-ups, develops products and tests solutions locally. In 2016, this team identified the Company Off Grid Electric (OGE), EDF’s partner in the supply of competitive off-grid solar energy in the Ivory Coast (see section 1.4.5.3.9 “Off-grid energy”). itelum in North America 1.4.5.3.4.6 Citelum, an EDF subsidiary in the field of urban street lighting, is also present in the United States (see section 1.4.6.1.2 “Citelum”). In 2018, Citelum has implemented more than 20,000 LED streetlights in the city of Albuquerque and developed an Internet of Things (IoT) architecture and deploy a central management system. Through this contract, Citelum USA is committed to reducing energy consumption and maintenance costs for a 15-year period, as well as providing better lighting and services. Citelum has been awarded by the city council of Dover (Delaware) for the 1 st phase of their planned streetlight project (inventory and photometric analysis).

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EDF I Reference Document 2018