EDF / 2018 Reference document

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PRESENTATION OF EDF GROUP Legislative and regulatory environment

Commitments by EDF (excluding network managers) EDF’s public service commitments include: access to the public electricity service and the supply of electricity to customers ■ who choose to remain at regulated tariffs; production and sales. These areas include the implementation of the energy ■ policy and maintaining secure power generation that is environmentally friendly; contributing to the safety of the electricity network. In this regard, EDF ■ undertakes to enter into several contracts with RTE, in particular concerning the optimisation of work on generation facilities and the availability of the resources required to maintain network balance. Commitments by network managers In the Public Service Contract, the Enedis and RTE network managers made commitments concerning the management of the public networks for the transmission and distribution of electricity and the safety of the electricity system. These commitments are financed by the Tariff for Using the Public Electricity transmission and distribution Networks (TURPE). These commitments concern, above all, network safety, supply quality, third party safety and the preservation of the environment – four areas where customers’ and local authorities’ expectations are especially high. More accessible services On 28 September 2010, the State and EDF, as well as eight other major public service operators, signed a partnership agreement entitled “+ de services au public” (“more services to the public”), which aims to develop access to a set of services intended for rural populations in France (information on bill payment, general information, travel ticket sales, etc.). Reception staff and internet access points are some of the many resources made available to users through shared facilities such as Multiservice Conciliation and Information Points (PIMMS), Public Service Relays (RSP) and other structures such as town halls. Following the experimental phase, during which these services were deployed in twenty-two French départements, in July 2013, the Inter-Ministerial Committee for the Modernisation of Public Action (CIMAP) decided to extend this initiative throughout France. Three European Directives, which form the basis for the current organisation of the electricity market in France, were successively adopted in order to lay down the common rules for the generation, transmission, distribution and supply of electricity. Directive no. 96/92/EC of 19 December 1996 laid the foundation for opening up the electricity market to competition. Directive no. 2003/54/EC of 26 June 2003 reiterated the major principles and took an additional step on the path to opening up the market, by progressively expanding eligibility to all customers. Directive no. 2009/72/EC of 13 July 2009, known as the “Third Directive”, was adopted as part of the third “Energy Package”. This Directive primarily strengthens the guarantees of the independence of transmission system operators and increases the power of the national regulatory authorities. These provisions were incorporated into the French Energy Code. Moreover, the rules that govern the conditions for access to the network for cross-border exchanges in electricity are currently defined by regulation (EC) no. 714/2009 of the European Parliament and Council of 13 July 2009, which is part of the third Energy Package. This regulation, inter alia, provides for a compensation mechanism between transmission system operators for the costs incurred by hosting cross-border flows of electricity on their networks. This compensation is paid by the operators of the national transmission systems from which cross-border flows originate and the systems where those flows end. ELECTRICITY MARKET LEGISLATION 1.5.3 European legislation 1.5.3.1

Mission to develop and operate public transmission and distribution networks

The mission to develop and operate the public electricity transmission and distribution networks, which is defined in Article L. 121-4 of the French Energy Code, involves ensuring: a rational electricity distribution service in France through the public transmission ■ and distribution networks, in a way that is environmentally friendly, the interconnection with neighbouring countries; connection and access to the public transmission and distribution networks, ■ under non-discriminatory conditions. Public network operators are designated by law to carry out this duty: RTE for transport, Enedis and Local Distribution Companies (Entreprises Locales de Distribution, or LDCs) for distribution, EDF in zones that are not interconnected to the continental metropolitan network. Mission to supply electricity The public service mission to supply electricity, which is defined in Article L. 121-5 of the French Energy Code, involves ensuring the supply of electricity throughout France to customers who benefit from regulated electricity sales tariffs. By law, this mission has been entrusted to EDF and to the LDCs. The conditions under which customers can benefit from regulated electricity sales tariffs are defined in Articles L. 337-7 et seq. of the French Energy Code. The mission to supply electricity also involves the application of the special “basic necessity” rate (TPN). This public service mission is assigned to all electricity suppliers. The Law 2015-992 of 17 August 2015 ("energy Transition law") provides for the gradual replacement of the TPN by “energy vouchers”. These vouchers are a special means of payment that allow households that are experiencing financial difficulties to cover part of their energy consumption expenses (electricity, gas, fuel oil, etc.) or their expenditure on improving the energy efficiency of their home. The mission to supply electricity moreover includes supplying emergency power to customers who are connected to the public networks. The relevant administrative authority designates emergency suppliers through one or more tendering procedures. As the implementing regulations had not yet been adopted on the date of this Reference Document, this provision has still not entered into force. Social cohesion Article L. 121-5 of the French Energy Code provides that the supply of electricity at regulated tariffs must contribute to social cohesion, in particular through the national equalisation of regulated electricity sale tariffs and tariff entitlement. Article L. 115-3 of the French Social Action and Families Code prohibits electricity suppliers from cutting off electricity supplies to the primary residences of individuals or families during the winter period (from 1 November to 31 March) due to unpaid bills, including through contract termination. Electricity suppliers may, nevertheless, in certain cases, reduce the power supplied, except with regard to customers who benefit from “energy vouchers”. In its capacity as an electricity supplier, EDF is required to maintain electricity supplies under the conditions laid down by said Article and by Decree no. 2008-780 of 13 August 2008 on the procedure that is applicable in the event of unpaid electricity, gas, heating and water bills, implemented in its amended form pursuant to Decree no. 2014-274 of 27 February 2014. Public Service Contract On 24 October 2005, a Public Service Contract was signed by the State and EDF pursuant to Article L. 121-46 of the French Energy Code. This contract, which details the commitments made by EDF and the State and specifies the rules governing the financial compensation for service commitments, will remain in force until a new contract is signed, as provided for in the contract itself.

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EDF I Reference Document 2018