EDF / 2020 Universal Registration Document

6 FINANCIAL STATEMENTS

Notes to the consolidated financial statements

The net values of property, plant and equipment operated under concessions other than French public electricity distribution concessions are as follows:

Changes in the scope of consolidation

Other movements

31/12/2020

31/12/2019

Increases

Decreases

(in millions of euros)

Land and buildings

1,528

137 718

(9)

(16)

-

1,640

Fossil-fired & hydropower plants

11,021

(23) (11)

29 (2)

(34)

11,711

Other

651

36

3

677 590

Assets in progress*

1,213

(528)

(5)

(30) (19)

(60) (91)

Gross value

14,413

363 (34)

(48)

14,618

Land and buildings

(956)

9

1

-

(980)

Fossil-fired & hydropower plants

(6,081)

(272)

19 11

24

28

(6,282)

Other

(458)

(36)

- -

1

(482)

Assets in progress*

(58)

-

-

42 71

(16)

Depreciation and impairment

(7,553) 6,860

(342)

39

25

(7,760) 6,858

NET VALUE

21

(9)

6

(20)

Increases in assets in progress are stated net of the effects of newly-commissioned assets. Assets in progress are detailed in note 10.6. *

At 31 December 2020, property, plant and equipment operated under concessions other than French public electricity distribution concessions comprise concession facilities mainly located in France and in Italy (hydropower, excluding public electricity distribution).

10.6

Assets in progress

2020

2019

(in millions of euros)

Intangible assets

1,581

1,415

Property, plant and equipment used in generation and other tangible assets owned by the Group Property, plant and equipment operated under concessions other than French public electricity distribution concessions

39,460

34,755

574

1,155

TOTAL ASSETS IN PROGRESS

41,615

37,325

Intangible assets Intangible assets in progress include notably studies for the EPR 2 project, amounting to €577 million (€414 million at 31 December 2019). A draft PPE published on 25 January 2019 by the Ministry for the Ecological and Inclusive Transition states that the Government, together with the industry, will conduct a programme of work by mid-2021 to examine the questions of the cost of new nuclear energy production and its advantages and disadvantages in relation to other low-carbon generation methods, the possible financing models, the project management modalities for new reactor projects and public consultation, and matters relating to the management of waste generated by the potential new nuclear fleet and based on this information and depending on developments in the energy situation, the Government will make a decision regarding the suitability of launching a renewal programme for nuclear installations. The Group is fully mobilised in the investigation and preparation of this case in all its components, in conjunction with the public authorities. Property, plant and equipment used in generation and other tangible assets owned by the Group At 31 December 2020, property, plant and equipment in progress used in generation and owned by the Group mainly comprise: Investments for the Flamanville 3 EPR amounting to €14,565 million, including ● capitalised interim interest of €3,291 million at 31 December 2020 (€13,653 million at 31 December 2019, including capitalised interim interest of €3,028 million). The amount capitalised for the Flamanville 3 project in the financial statements at 31 December 2020 is €14,792 million, which also includes €208 million (1) for assets that have been commissioned (see note 10.3).

This capitalised amount of €14,792 million including capitalised interim interest, includes, in addition to the construction cost: an inventory of spare parts and capitalised amounts totalling €466 million for ● related projects (notably the initial comprehensive inspection and North Area development); €691 million of pre-operating expenses and other property, plant and equipment ● related to the Flamanville project; and the elimination of internal balances on balance sheet items and margins between ● Framatome and EDF SA in connection with the Flamanville 3 EPR project (€277 million, essentially consisting of advances and progress payments); giving a construction cost at historical value of €10,318 million in the consolidated ● financial statements at 31 December 2020, and a construction cost at completion (excluding borrowing costs) of €12.4 billion (in 2015 euros), as announced on 9 October 2019. In its report of July 2020 on EPR technology, the French Court of Auditors (Cour des comptes) stated that by its calculations, in addition to the construction cost of €12.4 billion (in 2015 euros) announced by EDF, there will be further costs that could reach €6.7 billion (in 2015 euros), including €4.2 billion of interest expenses. As stated above, at 31 December 2020 the capitalised interest amounts to €3.3 billion and other capitalised project costs amount to €1.2 billion. The non-recurring additional costs resulting from the necessary repairs to the main secondary circuit welds are recorded in other income and expenses at the amount of €397 million in 2020 (see note 7); investments relating to Hinkley Point C, amounting to €13,586 million including ● capitalised interim interest of €518 million (€10,942 million at 31 December 2019 including capitalised interim interest of €318 million). In 2020 investments in this project amount to €2,868 million; studies concerning Sizewell C amounting to €324 million (€219 million in 2019). ●

(1) €292 million in gross value, less €84 million of depreciation.

342

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EDF - UNIVERSAL REGISTRATION DOCUMENT 2020