EDF / 2019 Universal registration document

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

Seveso facilities Since 1 June 2015, “Seveso” facilities have been governed by the provisions of the Seveso 3 Directive (2012/18 of 4 July 2012). The entry into force of the Seveso 3 Directive resulted in the use of dangerous products (under the CLP regulation of 16 December 2008) being incorporated into the scope of the Seveso regulations. The Seveso 3 Directive also contains stricter provisions concerning access by the public to information related to safety, public participation in the decision-making process and access to justice, as well as improvements in the way information is collected, managed, made available and shared. The Seveso 3 Directive also introduced stricter standards for facility inspections. These provisions have been incorporated into the French Environment Code, in Article L. 515-15 et seq. These provisions, which are complemented by two Decrees (no. 2014-285 and no. 2014-284) of 3 March 2014 and by an Order of 26 May 2014, entered into force on 1 June 2015. Decree no. 2015-1250 of 7 October 2015 amended the rules governing how the financial guarantees that are applicable to Seveso ICPEs are lodged, in particular by allowing operators of multiple facilities to pool these guarantees. The Order of 24 September 2018 “ determining the rules for calculating and conditions for lodging the financial guarantees provided for in Article R. 516-2-I of the French Environment Code ” sets out the terms for lodging financial guarantees and the methodology for calculating pooled guarantees from 1 January 2019. Facilities that are subject to the “IED” Directive Directive 2010/75/EU of 24 November 2010 on industrial emissions (known as the “IED” Directive) revised and recast several existing Directives into a single piece of legislation, including the IPPC, LCP, Waste Incineration and VOC Directives, among others. Chapter 3 of this Directive affects EDF as it regulates the combustion plants that are found in fossil fuel-fired plants, in particular. The applicable requirement levels depend on the rated thermal input of the combustion plants concerned and on the fuel used. This Directive, which was partially transposed into French law via Order no. 2012-7 of 5 January 2012 (and incorporated into the French Environment Code in Articles L. 515-28 to L. 515-31), has the effect of broadening the application of the IPPC Directive to include new activities, enhancing the scope of the best available techniques (BAT) on which the fixed emission limit values will be based, causing a periodic reconsideration of operating conditions in order to take into account changes in BAT and, in certain cases, requiring a “baseline report” on the state of soil. As of 20 December 2018, type 2781-1, 2910, 2931 & 3110 combustion plants will fall under the relevant stipulations set by the five Orders of 3 August 2018. Finally, Decree no. 2017-849 of 9 May 2017 “ amending the regulatory provisions of the French Environment Code on facilities mentioned in Annex I of Directive 2010/75/EU of the European Parliament and Council of 24 November 2010 on industrial emissions ” has streamlined administrative procedures (including the content of the review file) and made the implementation of the IED Directive more operational. Greenhouse gases (GHG) 1.5.3.1.3 Allowance trading scheme Some of the EDF group’s activities fall within the scope of European Directive 2003/87/EC of 13 October 2003 as last amended by Directive 2018-410 of 14 March 2018 amending Directive 2003/87/EC to enhance cost-effective emission reductions and low-carbon investments, and Decision (EU) 2015/1814 (the “ETS Directive”). In France, this Directive was transposed and integrated into Articles L. 229-5, R. 229-5 et seq. of the French Environment Code. The Group has an annual obligation to surrender allowances equal to the level of CO 2 emitted by its facilities. In order to comply with this obligation, under certain conditions, the Group may use credits issued under eligible projects for the project mechanisms provided for under Articles 6 and 12 of the Kyoto Protocol (joint implementation and clean development mechanism). Under the ETS Directive, the third period for the greenhouse gas (“GHG”) emission allowance trading scheme started on 1 January 2013. The rule for the electricity sector is the auctioning of quotas, in accordance with the rules defined by regulation (EU) No 1031/2010/CE of 12 November 2010. Since that date, EDF has to purchase 100% of its allowances. Order no. 2019-1034 and Decree no. 2019-1035 of 9 October 2019 on the greenhouse gas emissions allowance trading system (2021-2030) transposed the aforementioned Directive 2018-410 into French law. This legislation overhauls the greenhouse gas emissions allowance trading system, particularly with regard to the facilities covered by the system, the procedures for calculating emissions and monitoring and controlling allowances, and also with

regard to the required administrative permits. It should be noted that emergency units in basic nuclear facilities are no longer exempt. In order to support the price of GHG allowances on the European market, in Decision (EU) 2015/1814 of 6 October 2015 as amended by the aforementioned Directive 2018-410, the European Parliament and the Council decided to create a market “stability reserve” that makes it possible to remove surplus allowances from the market. This mechanism entered into force on 1 January 2019. GHG reporting Pursuant to Articles L. 229-25 and R. 229-46 et seq. of the French Environment Code (respectively amended by Order no. 2015-1737, Law no. 2016-1087 of 8 August 2016 and Decree no. 2015-1738 of 24 December 2015), companies with over 500 employees must provide an annual report on their greenhouse gas emissions and a summary of the actions they plan to take to reduce such emissions. Article R. 229-46, as amended by the aforementioned Decree of 24 December 2015, specifies that “ the groups defined in Article L. 2331-1 of the French Labour Code may draw up a consolidated report on greenhouse gas emissions for all their companies that have the same level 2 nomenclature code for French activities ” and that employ more than 500 persons. The information disclosed is made public and must be updated every four years. Specific regulations applicable to basic 1.5.3.2 nuclear facilities Basic nuclear facilities in France 1.5.3.2.1 Creation of basic nuclear facilities (BNFs) The construction of a BNF is authorised, following a public debate and a public enquiry based on the operator’s application, by a decree issued by the Prime Minister after consulting the Autorité de sûreté nucléaire (Nuclear Safety Authority – NSA) and on the basis of a report produced by the Minister for Nuclear Safety. The authorisation to commission a BNF is issued by the NSA after consulting the public. The conditions applicable to pumping water, discharging liquid and gaseous wastes − whether radioactive or not − and the related limit values, arising from the decree authorising the facility, are decided by the NSA. The decision setting the limit values for discharges by facilities into the environment also requires the approval of the Minister for Nuclear Safety. The NSA also issues regulations pursuant to the decree that authorises the facility to be set up, in order to prevent or limit the effects of any accidents or incidents, to define measures to protect residents on an individual and collective basis, limit noise pollution and manage the waste generated by and stored at the facilities. Rules on nuclear safety and the inspection of basic nuclear facilities EDF, Framatome and Cyclife France are subject in France to the provisions relating to basic nuclear facilities (BNF) governed by Articles L. 593-1 and R. 593-1 (recently introduced by the Decree of 14 March 2019) et seq. of the French Environment Code. These provisions are supplemented by the Order of 7 February 2012 as amended, setting out the general rules governing basic nuclear facilities (the “BNF Order”) and by regulatory decisions of a technical nature issued by the NSA, which require the approval of the relevant ministers. The general regulations applicable to basic nuclear facilities make the protection of public safety, health and sanitation, nature and the environment (the “protected interests”) a priority. During operation, operators are required to conduct a periodic review under Article L. 593-18 of the French Environment Code, as part of which they must implement an in-depth examination, every ten years, of the compliance of their facilities to ensure that they comply with the applicable standards, correct any discrepancies detected, improve the level of compliance and implement an in-depth examination of the effects of ageing equipment. Operators are required to send a report to the NSA and the Minister for Nuclear Safety setting out the findings of the review required under Article L. 593-18. A public enquiry must be held for the review-related provisions proposed by operators after the thirty-fifth year of operation of a nuclear power reactor. The NSA is an independent administrative authority and one of its main tasks is to control BNFs. It has set up a Sanctions Committee for that purpose, comprising Council of State and Supreme Court judges, which can impose administrative fines of up to €10 million. The Committee will start to operate once its members have been appointed.

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EDF | Universal registration document 2019

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