EDF_REGISTRATION_DOCUMENT_2017

6.

FINANCIAL STATEMENTS Balance Sheet

PROVISIONS RELATED TO NUCLEAR GENERATION - NOTE 28 BACK-END OF THE NUCLEAR CYCLE, PLANT DECOMMISSIONING AND LAST CORES

changes in legislation, particularly regarding safety, security and environmental ■ protection, and financing of nuclear expenses; changes in the regulatory decommissioning process and the time necessary for ■ issuance of administrative authorisations; future methods for storing long-lived radioactive waste and provision of storage ■ facilities by the French agency for radioactive waste management ANDRA (Agence nationale pour la gestion des déchets radioactifs); changes in certain financial parameters such as discount rates, notably in view of ■ the regulatory limits, inflation rates, or changes in the contractual terms of spent fuel management.

The provisions established by EDF for the nuclear generation fleet result from the Law of 28 June 2006 on long-term management of radioactive materials and waste, and the associated implementing provisions concerning secure financing of nuclear expenses. In compliance with the accounting principles described in note 1.15: EDF books provisions to cover all obligations related to the nuclear facilities it ■ operates; EDF holds dedicated assets for secure financing of long-term obligations (see ■ note 38). The calculation of provisions incorporates a level of risks and unknowns that depend on the operations concerned. The valuation of costs also carries uncertainty factors such as:

Details of changes in provisions for the back-end of the nuclear cycle, decommissioning and last cores are as follows:

Other changes (2)

Increases

Decreases

31/12/2016

Operating Financial (1)

Utilisation Reversals

31/12/2017

(in millions of euros)

Provisions for spent fuel management Provisions for removal and conditioning of waste Provisions for long-term radioactive waste management Provisions for the back-end of the nuclear cycle Provisions for nuclear plant decommissioning

10,658

443

545

(756)

(95)

(9)

10,786

-

74

31

(15)

636

726

8,966

44

556

(221)

-

(531)

8,814

19,624

561

1,132

(992)

(95)

96

20,326

14,122

2

658

(131)

- -

269

14,920

Provisions for last cores

2,287

-

95

-

5

2,387

Provisions for decommissioning and last cores

16,409

2

753

(131)

-

274

17,307

TOTAL PROVISIONS RELATED TO NUCLEAR GENERATION

36,033 37,633 The discount effect comprises the €1,505 million cost of unwinding the discount, and the effects of the change of real discount rate in 2017 via the income (1) statement for provisions with no related assets (€380 million) (cost of unwinding the discount). Other changes mainly include: (2) reclassification at 1 January 2017 of provisions for removal and conditioning of waste, which were previously included in long-term radioactive waste - management (€581 millon); the effects of the change of real discount rate at 31 December 2017 for provisions with related assets (€347 million). - 563 1,885 (1,123) (95) 370

28.1

PROVISIONS FOR SPENT NUCLEAR

The processing expenses included in these provisions exclusively concern spent fuel that can be recycled in existing facilities, including the portion in reactors but not yet irradiated. Expenses are measured based on forecast physical flows at the year-end, with reference to the contracts with AREVA (Orano) which define the terms for implementation of the framework agreement for the period 2008-2040. The most recent of these agreements, signed on 5 February 2016, covers the period 2016-2023. These provisions also cover long-term storage of spent fuel that cannot currently be recycled in existing installations: plutonium fuel (MOX) or uranium fuel derived from enriched processing, and fuel from Creys-Malville and Brennilis until fourth-generation reactors become available.

FUEL MANAGEMENT EDF’s currently adopted strategy with regards to the fuel cycle, in agreement with the French State, is to process spent fuel and to recycle the separated plutonium in the form of MOX fuel (Mixed OXide of plutonium and uranium). The quantities processed by AREVA (now Orano) at the request of EDF, totalling approximately 1,100 tonnes per year, are determined based on the quantity of recyclable plutonium in the reactors that are authorised to load MOX fuel. Consequently, provisions for spent fuel cover services associated with the following: removal of spent fuel from EDF's generation centres, as well as reception and ■ interim storage; processing, including conditioning and storage of recyclable matter and waste ■ resulting from this processing.

444

EDF I Reference Document 2017