EDF_REGISTRATION_DOCUMENT_2017

PRESENTATION OF EDF GROUP Description of the Group's activities

The cost of generating solar power has fallen considerably in recent years. However, there is still considerable room for improvement, especially in the field of innovation and enhanced industrial processes. EDF R&D also conducts research on photovoltaic technology at its Chatou site, under the aegis of the French Institute for Photovoltaic Power Research and Development (IRDEP), established in partnership with CNRS (National Centre for Scientific Research) and ENSCP (Paris National School of Chemistry). Biomass and biogas 1.4.1.5.2.3 Technologies based on biomass mainly consists of burning certain types of waste, particularly from the timber and farming industries, or exploiting woodfuel forests, to produce heat or electricity. Biofuels can come from a wide range of sources. There are three different energy streams: combustion plants for plant matter (wood, agricultural waste) or animal matter; biogas generation plants (gas generated from the fermentation of organic animal or plant matter); household waste incineration plants. Lastly, through its holdings, the Group owns shares in France (notably through its subsidiary Dalkia, see section 1.4.6.1.1 “Dalkia”), and abroad in several dozen heating networks and small-scale, mainly wood-fired generating plants. Geothermal energy 1.4.1.5.2.4 The temperature of the rocks in the earth’s crust increases with depth (3°C on average every 100 metres). In some regions, geothermal energy reaches the surface in the form of hot springs, water or steam. The hot water is used directly in the form of heat: central heating in homes or heating of greenhouses. Steam extracted from the ground is also used to generate electricity: as in a classic thermal power station, it drives a turbine. It is also possible to use hot and dry rocks as a source of electricity production from steam. To develop this type of energy, EDF has joined forces with several partners (including ÉS and German energy companies) as part of a European consortium that develops and operates a prototype geothermal power plant in the hot, naturally fractured crystalline rock around Soultz in Alsace. France also has high-temperature resources located in its overseas territories. The EDF group is present in this activity mainly through its minority stake in the Company Géothermie Bouillante in Guadeloupe. Other technologies 1.4.1.5.2.5 Renewable energies cover a wide range of sectors and technologies. To prepare for the future, EDF Énergies Nouvelles is responsible within the EDF group for identifying promising sectors and, with the support of the Group’s R&D teams or industrial partners, contributes to the emergence of new technologies. Along with so-called concentrated solar power (see section 1.4.1.5.2.2 “Solar photovoltaic power”) and energy storage, marine energy is another area the Group is exploring in depth. Two marine energy projects are currently under development: tidal turbines, which are underwater turbines harnessing the energy of tidal ■ currents. This technology is still at the development stage. EDF drew some useful lessons from its experiments with tidal turbines built by Open Hydro (Naval Group) at Paimpol-Bréhat in the Côtes-d’Armor département in Brittany. EDF Énergies Nouvelles, in partnership with Naval group, is working on the “Normandie Hydro” project, a larger-capacity tidal current turbine farm in the Raz Blanchard off the Cotentin peninsula in Normandy. floating offshore wind turbines: the Provence Grand Large project, led by EDF ■ Énergies Nouvelles, won the “Floating Wind Farms” call for projects initiated by the ADEME in August 2015. The project, located 17 kilometres off Napoleon Beach at Port-Saint-Louis-du-Rhône, foresees the construction of three 8MW Siemens turbines. EDF Énergies Nouvelles 1.4.1.5.3 Apart from hydropower, the EDF group’s involvement in renewable energy is undertaken mainly by EDF Énergies Nouvelles (EDF EN), a wholly-owned subsidiary. The companies in the EDF EN group had a combined 3,482 employees at 31 December 2017.

Excess output is in the process of being achieved for the La Bâthie plant to replace the six generation sets for an additional capacity of 50MW. At end-2017, works were carried out on three sets. The works consists of: adapting existing facilities (modernisation, optimising generation, etc.) as part of ■ concession renewals. Accordingly, in the context of renewing the Middle Romanche concession and in line with the decrees published on 31 December 2010, EDF has begun work to replace the six small existing plants with the construction of a new subterranean plant (Romanche-Gavet plant) with a capacity of 93MW and generation capability of 560GWh, or 155GWh more than the existing plants; developing “small-scale” hydropower plants (with capacity under 12MW). One ■ optimising and increasing the generation capacity of the existing fleet with ■ the return to service in 2017 of several facilities after an important programme of renovations like La Prétière, Ambialet and Brides-les-Bains, answering calls for tenders to build and/or operate microscale and ■ small-scale hydropower projects. Three projects proposed by SHEMA and Électricité de Strasbourg won a call for tender issued on 26 April 2016 for an installed capacity of 3MW. These plants must come into operation by 2021, a new call for tender was issued by the DGEC for a capacity of 105MW ■ spread over three years. The EDF group submitted three offers in January 2018. The winners will be announced in the first half of 2018 and must commission their facilities within four to five years. EDF has also strengthened the range of initiatives pursued by its entities in support of regional and local development. This approach is reflected in the establishment of the “One River, One Territory” development programme, which had opened seven agencies around France by the end of 2017. New renewable energies 1.4.1.5.2 Wind power 1.4.1.5.2.1 A wind turbine uses the action of the wind to drive rotor blades connected to an electrical generator. There are various categories: onshore wind power, a proven and increasingly competitive sector which is now ■ close to competing with, if not matching, traditional sectors in certain areas. It benefits from economic incentives in various countries, although an increasing number of projects are developed without a financial support mechanism (see section 1.5.3 “Electricity market legislation”). On average, the rated capacity of onshore wind turbines installed worldwide is more than 2MW, a figure which is increasing steadily. The subsidiary responsible for developing wind power within the Group is EDF Énergies Nouvelles. The subsidiaries EDF Luminus, Edison and EDF Energy also have wind farms in service; offshore wind power, a less mature, high-growth sector which currently requires ■ a higher initial investment and is more expensive to connect to the grid than onshore wind power and whose operation and maintenance are more difficult. The advantages of this sector are the higher rated capacity of each wind turbine (typically over 5MW) and increased productivity due to more reliable winds. The sector is on a learning curve that will enable it to reduce the cost differential with onshore wind generation. The EDF group has decided to ramp up its investment in offshore wind generation which offers interesting development prospects in some of the Group’s key countries including France and the United Kingdom. Solar photovoltaic power 1.4.1.5.2.2 The operating principle of solar photovoltaic power is to convert sunlight directly into electricity. Photovoltaic solar power is used in two ways: it can either be connected to the grid, or it can generate electricity at isolated sites. Grid-connected photovoltaic systems have witnessed steady growth around the world in two markets: ground-based solar farms and rooftop installations on buildings and homes. of the aims is to develop small-scale hydropower by: forging partnerships for project development, ■

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DF I Reference Document 2017