EDF / 2019 Universal registration document

1. The Group, its strategy and activities Legislative and regulatory environment

At 31 December 2019, the deferred amount is +€1,297 million (this represents a receivable from Enedis in relation to their network users, which is not recognised on the Group’s balance sheet at 31 December 2019, pursuant to the accounting standards in force on this date). Energy efficiency Energy Efficiency Directive On 25 October 2012, the European Union adopted a Directive on energy efficiency (2012/27/EU). The purpose of this Directive is to enable the European Union to reach its energy savings target of 20% by 2020. With this aim in mind, the Directive enhances the provisions of European legislation on energy efficiency services (2006/32/EC) and cogeneration (2004/8/EC). The Directive of 25 October 2012 contains several provisions that are liable to impact the activities of the EDF group, first and foremost of which is the obligation for Member States to reach an energy savings target each year that is equivalent to an aggregate annual reduction in energy sales of 1.5% over the period 2014-2020, which can take the form of an obligation for energy distributors and/or suppliers to reduce sales. The Directive also contains provisions on providing customers with information on their consumption, the promotion of energy services, taking into account energy efficiency in heat and cold production, and in the transmission and distribution of energy. Published in the Official Journal of the European Union on 19 June 2018, Directive (EU) 2018/844 of 30 May 2018 amending Directive 2010/31/EU on the energy performance of buildings and Directive 2012/27/EU on energy efficiency strengthens current provisions and simplifies some of their aspects under the EU Commission’s “Clean Energy Package”. The Directive must be transposed by member states no later than 10 March 2020. Energy audits Articles L. 233-1 et seq. of the French Energy Code (derived from Law no. 2013-619 of 16 July 2013, which transposed Article 8-4 of the Directive into French law, and recently amended by Law no. 2018-670 on protection of business secrecy), require large companies to conduct an energy audit on their business activities in France by 5 December 2015 at the latest, then every four years. The thresholds above which companies are concerned, the scope of the audit and the conditions to be met by the energy auditors are laid down in Articles R. 233-1 and R. 233-2 and D. 233-3 to D. 223-9 of the French Energy Code, completed by the Order of 24 November 2014 on the terms and conditions of application of the energy audit. Undertakings that use a certified energy management system that is ISO 50001 compliant may, under certain conditions, be exempted from this obligation. In accordance with regulations, EDF has sent an audit report to the administration. Energy savings certificates At the national level, the energy savings certificates (CEE) mechanism, which is provided for in Articles L. 221-1 et seq. of the French Energy Code, places energy suppliers under the obligation to save energy. This mechanism defines a three-year objective that is shared between persons subject to an obligation to achieve energy savings (the “obligors”) based on their sales volumes. At the end of the relevant period and under penalty of sanctions, the obligors must produce energy savings certificates that correspond to the amount of the energy savings they are under the obligation to achieve, which are obtained either by carrying out (directly or indirectly) energy savings actions or by purchasing credits from the other obligors or “eligible” economic players through a National Register of Certificates (the Emmy Register). The mechanism’s third period started on 1 January 2015 and ended on 31 December 2017. The Law of 17 August 2015 on Energy Transition for Green Growth amended the CEE system for the third period, by adding an additional system to the obligation that was already provided for, concerning the energy savings made for the benefit of households that are in a precarious situation in terms of energy. The fourth period started on 1 January 2018 and will end on 31 December 2021, following the one-year extension provided for in the Energy and Climate Law of 8 November 2019. Decree no. 2017-690 of 2 May 2017 on energy savings certificates (codified in Articles R. 221-1 et seq. of the French Energy Code) sets forth the implementation methods for energy savings certificates for the fourth period. The text sets the total level of obligations for the 2018-2020 periods at 1,200TWhp of classic shares and an

extra 400TWhp to be achieved for households in a situation of energy poverty. It involves a doubling of obligations compared with the third period. Decree no. 2017-1848 of 29 December 2017 (codified in Articles R. 221-1 et seq. of the French Energy Code) sets the ceiling for the assistance programmes at 200 billion kWh of updated combined end use electricity. The Pacte business reform law no. 2019-486 of 22 May 2019 amends Article L. 221-7 of the French Energy Code. Energy savings certificates (white certificates) may now be issued for energy saving actions carried out at the facilities classified for the protection of the environment (ICPEs) referred to in Article L. 229-5 of the French Environment Code. Decree no. 2019-975 of 20 September 2019 relating to the application of the energy savings certificates scheme for facilities subject to greenhouse gas emission allowances sets out the terms on which energy savings certificates may be issued for energy saving actions carried out at facilities subject to greenhouse gas emission allowances. The Energy and Climate Law no. 2019-1147 of 8 November 2019 extends the length of the fourth period and also includes a chapter relating, in particular, to preventing certificate fraud. The Law aims to strengthen the effectiveness of controls and sanctions. Italian law: the new capacity market 1.5.2.1.3 Outline A capacity mechanism was launched in Italy in 2019: it was validated as state aid by the European Commission on 14/06/2019 (State Aid number SA.53821) until the end of 2028; an implementing decree was issued for this mechanism by the Minister for Economic Development on 28/06/2019. Terna, the Transmission Network Manager, defined the rules after consultation with stakeholders, and the first auctions took place in November 2019 for the 2022 and 2023 delivery years. The capacity mechanism implemented in Italy is a “Market Wide” mechanism (remunerating all capacity required to meet security of supply criteria), with centralised “pay as clear” auctions, price zones in case of potential congestion and carbon emission limits. Capacity availability is primarily encouraged through the “reliability option” system specified below. Fixed Premium Selected capacity is remunerated by a fixed annual premium stated in Euros/MW/year (paid monthly during the delivery year). Prices are established by cross-referencing a demand curve produced by Terna with a supply curve (bids at auctions). A bid cap for existing capacity is set within a range of between €25,000/MW/year and €45,000/MW/year (€33,000/MW/year for the 2022 and 2023 delivery years). A bid cap for new capacity is set within a range of between €75,000/MW/year and €95,000/MW/year (€75,000/MW/year for the 2022 and 2023 delivery years). Incentives for capacity availability The “reliability option” scheme adopted by Italy involves a “repayment obligation”: the selected counterparty must pay Terna the positive difference between a reference price and a predetermined strike price, whether or not the capacity is available at that time. The reference price is based on the day-ahead market price and the balancing (adjustment) price of the price zone where the capacity is located. The strike price is set at the level of the standard hourly variable cost of the technology with the highest variable costs ( i.e. the peak technology). The peak technology chosen by the Authority for 2022 and 2023 is the OCGT (open-cycle gas turbine), with a variable production cost of €125/MWh in 2017. Carbon emission limits New and refurbished capacity is only eligible for the capacity mechanism if it does not emit more than 550g of fossil-fuel carbon emissions per kWh of electricity. Existing capacity is only eligible for the capacity mechanism if it does not emit more than 550g of fossil-fuel carbon emissions per kWh of electricity. If this limit is not respected, existing capacity may still be eligible if it commits not to emit more than 350kg of fossil-fuel carbon emissions on average per installed kWe for a given delivery year.

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EDF | Universal registration document 2019