EDF / 2020 Universal Registration Document

1 THE GROUP, ITS STRATEGY AND ACTIVITIES Description of the Group’s activities RTE has had to face a variety of challenges in its mission as an electricity transmission network operator: integration of the European market, extensive restructuring of the generating fleet, societal changes reinforcing the constraints of integrating new infrastructure of common interest and maintenance of its industrial facilities to meet the requirements of customers and the community at large. On 16 March 2020, RTE, a “critically important operator”, triggered its business continuity plan to ensure continuity of all its business amid the Covid-19 health crisis. Regulatory notice Pursuant to Article L. 341-3 of the French Energy Code, the tariff for using the public electricity transmission network is set by way of a reasoned decision by the CRE. Set by the CRE’s decision of 17 November 2016, published in the French Official Journal on 28 January 2017, TURPE 5 HTB came into force on 1 August 2017 for a period of four years, with an initial increase of 6.76%. This initial increase was followed by an inflation-based change on 1 August of each year (apart from corrections arising from the income and expense regularisation account). On 1 August 2020, the tariff change was -1.08%. A new tariff period will begin in August 2021 for a period of four years. The CRE’s decision of 21 January 2021 on the TURPE 6 HTB tariff (with a view to publication in the French Official Journal in the first quarter of 2021) sets the framework, structure, and level of this new tariff. It provides for an initial increase of 1.09% on 1 August 2021 and an average increase of 1.57% annually for the period (based on the scenario of average annual inflation of 1.07% for the period). The financial return of RTE assets is the result of the product of the regulated asset base (RAB) and a nominal rate before tax. This rate of return took the value of 6.125% for the TURPE 5 tariff period. For the TURPE 6 tariff period, the tariff decision set the rate of return at 4.6%. On 1 January 2021, the RAB amounts to €14.5 billion (1) . The value of the RAB includes RTE's commissioned industrial assets, minus investment subsidies and is calculated excluding assets under construction (which are remunerated at the debt rate, i.e. 3.7% until 2020 in application of the TURPE 5 tariff and 2.4% from 2021 in application of the TURPE 6 tariff). Third-party access to the network Article L. 111-91 of the French Energy Code provides that network managers must guarantee access to the public transmission and distribution networks, notably in order to: perform the public service missions to supply electricity at regulated electricity sales tariffs and at basic necessity special rates; perform electricity procurement contracts; perform electricity export agreements signed by a producer or by a supplier located on French national territory. Disputes concerning third-party access to networks are heard by the Settlement of Disputes and Sanctions Committee (“CoRDIS”), which is part of the Energy Regulation Commission (CRE). Tariff for Using the Public Transmission and Distribution Networks (TURPE) Maintenance of the transmission 1.4.4.1.2.1 infrastructure RTE manages the assets of the transmission network through maintenance, refurbishment and replacement of structures and emergency repairs. The gradual integration of new technologies, in particular monitoring, will make it possible to optimise technical policy and to develop conditional and predictive maintenance, further enhancing the effectiveness of each intervention by limiting action to what is strictly necessary. Digitalisation of the grid and large-scale monitoring will make it possible to carry out remote diagnosis and deploy new maintenance technologies such as drones, 3-D visualisation, and augmented reality. Alongside this, test and simulation software will provide decision support for grid management. Massive data analysis will allow new asset management strategies to be developed, with the potential to achieve a different balance between maintenance, renovation, and renewal.

Development and completion of new capital 1.4.4.1.2.2 investments Energy transition is changing the fundamentals of the French electricity system. In response, RTE is adapting its business to prepare and support these major changes. Each year, RTE draws up an annual investment programme that is submitted to CRE’s approval. In 2020, against the backdrop of the Covid-19 health crisis, RTE continued with most of its investments. Postponements of operations to be performed were limited, thanks to the actions undertaken to continue business during lockdown and the proactive rescheduling of interventions. In 2020, RTE’s total investments within the scope regulated by the CRE stayed at a high level of €1,529 million. The main investments relate to: the continuation of construction works on two direct current interconnections (“Savoie-Piedmont” between France and Italy and “IFA 2” between France and the UK); the launch of connection works for the future offshore wind farms of Fécamp and Saint-Brieuc; the continuation of the connection works of the Saint-Nazaire offshore wind farm; the reconstruction of the 400,000V Avelin-Gavrelle line between the south of Lille and the north-west of Arras (started in 2019); the resumption of the Haute-Durance programme (securing supply to the Haute Durance Valley). RTE’s 2021 investment programme approved by CRE amounts to €1,717.6 million. This conveys the implementation of the trajectory presented in the ten-year plan for development of the network ( Schéma décennal de développement du réseau, SDDR) to support energy transition and changes arising from EU market integration. The investment programme is characterised by ongoing major investments in grid expansion and renewal, more especially the progress of offshore network development works, continuation of major grid adaptation projects, as well as the development and renewal of IT systems and real estate. 1.4.4.1.2.3 Operation of the electricity system Management of the electricity system 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 parties” (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 electricity market players can sell and purchase their energy in another European Union country, by taking advantage of the price differences 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 (2) 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.

(1) Amounts to be conformed by the CRE. (2) 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 2020