EDF / 2019 Universal registration document

6. Financial statements Information relating to the allocation of proceeds raised through Green Bonds issued by EDF

Information relating to the allocation 6.7 of proceeds raised through Green Bonds issued by EDF

Since 2013 the Group has conducted four Green Bond issues for a total of around €4.5 billion in order to support its development in renewable energies. After two bond issues chiefly meant to finance the building of new wind and solar projects by its subsidiary EDF Renewables (€1.4 billion in November 2013 and $1.25 billion in October 2015), the Group expanded its Green Bond Framework to finance investments in the renovation and modernisation of its hydropower assets in mainland France. The new Framework was first applied to a €1.75 billion issue in October 2016 and then to a JPY 26 billion issue in two tranches in January 2017. The Group further extended the scope of its Green Bond Framework at the beginning of 2020 by opening it up to international hydropower assets, energy efficiency projects and biodiversity conservation projects. The commitments made by EDF in the context of these two bond issues follow the four Green Bond Principles  (1)  guiding (i) the use of proceeds, (ii) existing processes for evaluating and selecting eligible projects, (iii) the management of proceeds, and (iv) reporting procedures. A detailed description of these investments can be found in the EDF Green Bond Framework of September 2016 available on the Green Bonds page of the Company’s website. This section provides a summary of these commitments and how EDF has fulfilled them as at the end of 2019. Use of proceeds EDF has committed itself to allocate the proceeds from its Green Bonds programme to finance new investments in renewable energy projects. Projects eligible for  (2) Green Bond ("Eligible Projects") financing are: projects built by EDF Renewables to generate electricity from renewable sources ■ and to a lower extent by Luminus in Belgium; investments in existing hydropower facilities in mainland France within the ■ following categories: renovation and heavy maintenance, modernisation and automation, and works on existing plants (including, in particular, capacity increases). There are no plans to use the proceeds raised to refinance existing projects or acquire operational businesses or facilities. Assessment and selection of financed eligible projects Each Eligible Project to be funded is assessed against the environmental and social eligibility criteria (3) (“E&S criteria”) specific to EDF Renewables’ or Luminus’ investments, on the one hand, and to hydroelectric investments, on the other, by the Financial Department of EDF Renewables, Luminus, and the Financial

Department of EDF Hydro. Assessments are based on information provided by the teams in charge of development, purchasing and sustainable development matters. Only projects meeting the E&S criteria qualify for Green Bond financing. Those projects over which EDF Renewables has direct control are financed as a priority. The entire project assessment process is documented so as to be able to show an independent auditor that projects financed meet the eligibility criteria. On this basis, the Finance Departments of EDF Renewables, Luminus and EDF Hydro select which Eligible Projects are financed. Management of proceeds Proceeds raised are managed according to a strict ring-fencing principle in order to ensure that their use is exclusively and effectively reserved for financing Eligible Projects. Once received by EDF’s Finance and Investment Department, proceeds from each bond issue are invested and tracked in a dedicated sub-portfolio of treasury assets until allocated to Eligible Projects. Proceeds are invested in priority in treasury assets identified as Socially Responsible Investments (SRI). The finance departments of EDF Renewables, Luminus and EDF Hydro notify EDF’s Treasury Department, on an ongoing basis or at regular intervals, of the proceeds needed to cover investments related to the selected projects. Based on this information the Treasury Department adjusts the amounts available in the dedicated treasury asset sub-portfolios. EDF aims to allocate the entirety of proceeds raised within 36 months of a bond issue. Reporting Effective use of proceeds All the proceeds raised in November 2013 under the first Green Bond issued by EDF for €1.4 billion were allocated by June 2015. All the proceeds raised in October 2015 under the second Green Bond issued for $1.25 billion were allocated by the end of 2017. The funds raised as part of the €1.75 billion third Green Bond issued in October 2016 were allocated at the end of 2019. At 31 December 2019, of the 26 billion yen raised in two tranches in January 2017 under the fourth Green Bond issued by EDF, 17.1 billion yen had been allocated to Eligible Projects. The balance of proceeds raised under the Green Bonds issued in January 2017 was invested in a dedicated treasury asset portfolio, as indicated above, where it will remain until allocated to Eligible Projects.

(2) Only projects from category (i) are eligible for financing using proceeds raised by the bond issues of November 2013 and October 2015. (3) The E&S criteria for each project type are presented in the appendix to the EDF Green Bond Framework of September 2016. (1) The Green Bond Principles, updated in June 2018, are voluntary guidelines for issuance of Green Bonds. They recommend transparency and disclosure and promote integrity to support development of the Green Bond market. For more information, see http://www.icmagroup.org/Regulatory-Policy-and-Market-Practice/green-bonds/green-bond-principles.

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EDF | Universal registration document 2019

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