EDF / 2019 Universal registration document

1. The Group, its strategy and activities Description of the Group’s activities

Operation of the electricity system 1.4.4.1.2.3 Management of the electricity system

RTE and Elia were then gradually joined by grid operators in Western Europe: National Grid ESO (UK), Terna (Italy), 50 Hertz (North-East Germany), REN (Portugal), REE (Spain) and recently Eirgrid and SONI (Ireland). Energy report 1.4.4.1.3 2019 Summary In 2019, gross consumption stood at close to 474TWh, i.e. 1% down compared with the previous year. This decrease is due to milder temperatures overall, especially at the very beginning of the year, and less sustained economic growth than in 2018. Electricity consumption peaked at 88.5GW at 7pm on Thursday 24 January during a heavy lowland snow episode. This peak is around average for the last twenty years in France. Excluding the energy sector, consumption adjusted for climatic variations and calendar effects reached 471TWh in 2019, slightly decreasing compared with 2018 (-0.8%) and stayed fairly stable over the last ten years. The main structural factors behind this stabilisation are less sustained economic growth and the effects of consumption management (energy efficiency initiatives). Energy use by heavy industry customers directly connected to the public grid amounted to 64.3TWh (including self-consumption, not including losses or energy sectors, and adjusted for seasonal variations). This amount was down 3% compared to 2018, and relates to the steel, paper and cardboard, automotive, and rail transport industries. The quality of electricity supplied by RTE is estimated on the basis of two indicators: the equivalent outage time and outage frequency. The values of these indicators for 2019 are still provisional. Based on information available to date, the equivalent outage time is 3 min. 25 sec. (the target set by the CRE is 2min. 48 sec.) and 0.37 for outage frequency (the target set by the CRE is 0.46).

RTE manages the flows on the transmission network in real time, and makes use of the resources available to it through the adjustment mechanism to ensure the balance between supply and demand in real time. The cost corresponding to the adjustments made by RTE and due to the negative differences between the projected flows and those already realised is passed on to the “Balance responsible entities” (producers, traders, suppliers, etc.) in proportion to their difference. In the case of a positive difference, RTE compensates the balance responsible entities financially. Management of the interconnections RTE manages access to international interconnections in collaboration with the neighbouring European transmission network operators. These interconnections ensure the transmission of energy from one country to another, the operating safety of the electricity transmission networks and the development of the European electricity market. They ensure that an electricity supplier can sell its energy to a customer in another European Union country, by taking advantage of the differences in the timing of peak load on either side of the border, and can better pool the means of generation at the European level (including renewable energies). Network coordination in Europe In December 2008, RTE and Elia  (1) created a common company named Coreso, which aims to coordinate the operation of electricity networks comprising France and Belgium. The creation of Coreso fulfils the need of reinforcing the operational coordination between transmission network operators (TNO) expressed both by the European Commission and by the players of the electricity market. Coreso must allow better integration at the regional level of generation from renewable sources and guarantee secure management of rising cross-border flows.

Simplified energy flows on the RTE network (in Twh)

600

600

Export balance of physical exchanges (2) 63 Energy withdrawn for pumping 7.3

Export balance of physical exchanges (2) 55.7 Energy withdrawn for pumping 8

548.6

537.7

500

500

400

400

300

300

Generation

Generation

Deliveries 474

Deliveries 478.3

200

200

100

100

0

0

Injections Withdrawals

Injections Withdrawals

2018

2019 (1)

(1) 2019 provisional data (the final data on the electricity generation for 2019 will be available on RTE’s website in july 2020: www.rte-france.com). (2) Including water right and exchanges via distribution network.

Renewable energies continue to grow, nurturing energy transition As of 31 December 2019, installed wind power capacity was 16,494MW, 9% higher than in 2018. Wind power generation stood at 34.1TWh in 2019, up 21.2% compared with 2018. This increase is due not only to the increase in installed net capacity but also to particularly favourable weather conditions in 2019.

With 890MW of new solar capacity connected in mainland France, installed solar capacity reached 9,435MW at 31 December 2019. This represented an increase of 10.4% compared with 2018. Solar power, which totalled 10.6TWh in 2019, was 1.8% higher than in 2018; the new plants installed did not wholly offset the unfavourable weather conditions.

(1) Elia is the Belgian electricity transmission network operator for high voltage (from 30,000 to 380,000 Volts).

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EDF | Universal registration document 2019