EDF / 2018 Reference document

PRESENTATION OF EDF GROUP Legislative and regulatory environment

Law no. 2017-1839 of 30 December 2017 ending the research and use conventional and non-conventional hydrocarbons and introducing various provisions relating to energy and the environment, published in the Journal Officiel of 30 December 2017 amends the rules for accessing underground natural gas storage facilities necessary for the security of supply, to establish a regulated access framework, guaranteeing the coverage of the costs borne by the operators of these facilities through the natural gas transmission network access tariffs. Suppliers will be able to subscribe to storage capacities via an auction system, the terms of which will be defined by the CRE. Obligations to hold natural gas stocks by suppliers provided for in Article L. 421-4 of the French Energy Code have therefore been abolished. Decree no. 2018-221 of 30 March 2018 on building additional natural gas stores, mentioned in Article L. 421-6 of the French Energy Code, and Decree no. 2018-276 of 18 April 2018 amending various provisions of the regulatory section of the French Energy Code on the natural gas sector, amended the regulatory section of the French Energy Code on access to natural gas underground storage to take legislative changes introduced by Law no. 2017-1839 of 30 December 2017 into account. The Order of 9 May 2018 on taking storage capacity rented from another member state of the European Union into account when applying Article D.421-12 of the French Energy Code repealed the decree of 31 July 2017. Lastly, the CRE implemented the reform of natural gas storage by means of three decisions issued on 22 February 2018 pertaining to (i) the tariff for using natural gas underground storage infrastructure, (ii) the terms under which storage capacity may be sold, and (iii) the introduction of a storage tariff payment in the tariff for using GRTgaz's and TIGF's transmission networks, to which was added, after the storage capacity auction, the CRE's decision on 27 March 2018 to set the amount of the storage tariff payment in the tariff for using natural gas transmission networks. Control and penalties The French Energy Code grants the Minister for the Economy, the Minister for Energy and the CRE, power to oversee the gas market. The Minister for Energy may also levy a fine, or withdraw or suspend an authorisation to supply natural gas. The CRE can carry out investigations into whether offences that breach the provisions of the French Energy Code have been committed (Article L. 135-13 of the French Energy Code). CONCESSIONS IN FRANCE French legal system applicable to concessions In accordance with Articles L. 121-4 et seq. and L. 322-1 et seq. of the French Energy Code, and Article L. 2224-31 of the French Local Authorities Code, the public distribution of electricity is operated under a system of public service concessions. Pursuant to this body of law, the contracting authorities organise the public electricity distribution service through concession agreements and general specifications that set forth the respective rights and obligations of the contracting authority and the operator. Currently, the contracting authorities are most often public institutions formed by associations of several municipalities cooperating together, however contracting authorities at département level are becoming more common. The separation of supply and network activities imposed by Community Directives has led to the identification of a public service with two distinct missions: on the one hand, the regulated tariff supply mission entrusted to EDF and the LDCs in their exclusive service areas and, on the other hand, the development and operation of the public electricity distribution networks, entrusted to Enedis and the LDCs in their service areas, and EDF for areas not interconnected to the continental metropolitan network. Article L. 334-3 of the French Energy Code provides that the signature of new concession agreements and amendments, as well as renewals of existing concession agreements, must be executed by three parties: the contracting authority, the distribution network manager (for the provisions relating to management of the public distribution network) and by EDF (or the LDC that has the authority in the geographic area) for supply at regulated tariffs. The other current concession agreements in force are deemed to have been signed jointly by these three entities. PUBLIC ELECTRICITY DISTRIBUTION 1.5.5

Pursuant to Order no. 2016-65 of 29 January 2016 on concession agreements and its Application Decree no. 2016-86 of 1 February 2016, transposing Community Directive no. 2014/23/EU of 26 February 2014 into national law, concession contracts for the operation of the public distribution network and the supply of electricity at regulated tariffs are concluded by mutual agreement, that is to say without publicity and competitive bidding procedures. The ELAN Housing bill adds chapter 5 about rising mains to the section of the French Energy Code on accessing and connecting to electricity networks. Rising mains put into service after the law is published will belong to the public distribution network. Those put into service before the law is published must be integrated into the public distribution network within two years of the law's publication. Owners and joint owners can apply to have their rising mains integrated ahead of time. They can also choose to retain ownership of the mains. Rights of the contracting authorities The rights of the contracting authorities are detailed in section 1.4.4.2.2. (“Distribution Activities”) of this Reference Document. EDF’s business in France, as well as in other countries where EDF operates, is subject to regulations that are applicable to the environment, nuclear power, health, hygiene and safety. Compliance with these increasingly strict and continuously changing regulations exposes the Group to significant costs in order to ensure it does business compliantly. General regulations applicable 1.5.6.1 to the environment, health, hygiene and safety Environmental regulations Public involvement in environmental matters The general framework for the public’s involvement in the preparation of regulatory and individual decisions by the public authorities that have an impact on the environment is laid down in Articles L. 120-1 et seq. of the French Environment Code. These provisions apply in the absence of specific provisions that are laid down by specialised legislation. This legal framework has recently evolved with the adoption of Order no. 2016-1060 of 3 August 2016 reforming procedures to ensure public information and involvement in the development of certain decisions that may have an impact on the environment, completed by Decree no. 2017-626 of 25 April 2017. This order, which was adopted pursuant to Law no. 2015-990 of 6 August 2015 on Growth, Business and Equal Opportunities (known as the “Macron Law”), (i) introduced an opening chapter into the French Environment Code that defines the targets for public involvement and the rights of those involved, (ii) expanded the consultation procedure ahead of the decision-making process and (iii) modernised the procedures for downstream consultation. Environmental Liability (the “LRE” Law) The purpose of the Law of 1 August 2008 on Environmental Liability (LRE), which is incorporated into the French Environment Code under Articles L. 160-1 to L. 165-2, is to promote the prevention and remedying of environmental damage to water, soil and biodiversity that reaches a certain level of seriousness. The remedy must be environmental only and must allow the natural environment to return to its previous state or an equivalent state. Balanced management of water resources The Water Framework Directive of 23 October 2000 is the foundation of Community water policy. It defines a framework for the management and protection of water, for each major river basin, and sets targets for maintaining and restoring the status of surface waters, in particular to ensure the correct ecological and/or chemical status of water by 2015. REGULATIONS APPLICABLE 1.5.6 TO THE ENVIRONMENT, NUCLEAR POWER, HEALTH, HYGIENE AND SAFETY IN FRANCE

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EDF I Reference Document 2018