EDF_REGISTRATION_DOCUMENT_2017

1.

PRESENTATION OF EDF GROUP Description of the Group's activities

continue investing in Nuclear New Build in the UK in order to complete the ■ Hinkley Point C project with £19.6 billion (1) for 100% of the project (see section 1.4.5.1.2.5 “Nuclear New Build Division”); continue its “Grand Carénage” industrial programme for nuclear power in France ■ for an investment of € 2013 45 billion (see section 1.4.1.1.2 “Operation and technical performance of the nuclear installed base”); intensify its investments in renewable energies in France and internationally, with ■ a gross investment in renewables above €2 billion per year over the 2017-2020 period, and develop its installed capacities in solar power with the launch on 11 December 2017 of the Solar Plan, planning the installation of 30GW of photovoltaic solar capacities between 2020 and 2035, which should be mainly financed through partnerships.

With respect to the here above Flamanville 3, Linky, Hinkley Point C and "Grand Carénage" projects, as well as the investments in renewable energies, the firm commitments made by the Group on the acquisitions of tangible and intangible assets are set out in note 44.1.2.1 of the notes to the consolidated financial statements as at 31 December 2017. Moreover, in 2017, firm commitments in connection with the acquisition of tangible assets for the building of Hinkley Point C have been formalised under contractual agreements for an amount of €2.7 billion. Lastly, in line with both its integrated electricity generator strategy and the CAP 2030 strategic principles, the Group will selectively target new development projects in addition to those already initiated, in line with its policy and financial constraints: EPR 2 projects, new nuclear projects in the UK, new projects in renewable energy, as well as international equity investments. Given its financial constraints, the Group will whenever possible, use partnerships to finance its new projects.

1.4

DESCRIPTION OF THE GROUP'S ACTIVITIES

Strengths of the generation fleet The Group’s generation fleet has significant strengths:

The EDF group is an integrated energy company active in all electricity businesses: nuclear, renewable and thermal generation, transmission (through RTE (2) , an entity accounted for using the equity method), distribution (through Enedis), sales and marketing, efficiency and energy services, and energy trading. It is the leading player in the French electricity market and holds strong positions in Europe (mainly in the United Kingdom (UK), Italy and Belgium), which makes it one of the world’s leading electric energy companies and a renowned gas player. With a global installed net generation capacity of 129.3GWe (3) as at 31 December 2017, generating 580.8TWh, the Group has one of the largest generation fleets in the world. Among the ten largest global power suppliers, it produces the smallest amount of CO 2 per kilowatt-hour generated (4) thanks to the share of nuclear, hydro and other renewable energies in its generation mix. The EDF group supplies electricity, gas and related services to 35.1 million customer (5) accounts worldwide (of which 26.5 million in France). The Group is thus implementing an integrated model for the joint operational management of its portfolio of assets upstream (generation and procurement of energy and fuels) and downstream (wholesale and retail) to guarantee supply of energy to its customers through the best possible management of operational and market risks and with a view to maximising gross margin. In addition, the Group is present in the regulated electricity transmission and distribution sectors, in particular via RTE and Enedis, respectively, which are fully independent subsidiaries as defined by the French Energy Code (see section 1.4.4 “Transmission and distribution activities in France”). ACTIVITY In mainland France, the electricity generation activities are split across the Nuclear and Thermal Fleet Department and the Renewable Energy Division. In addition to these two departments, the Engineering and New Nuclear Project Department is responsible for the development projects for the Group’s new nuclear generation assets, in France and abroad. Each of these three departments has all the expertise and performance drivers required to operate the leading European electricity generation fleet and ensure its development and sustainability, and offer their technical and industrial expertise to the whole Group in these three areas (also see section 1.4.5 “International activities”). ELECTRICITY GENERATION 1.4.1

a competitive generation mix with low variable generation costs (6) and limited ■ exposure to hydrocarbon and carbon market fluctuations due to nuclear and hydropower facilities; a variety of means of generation, which enable adequate coverage of EDF’s ■ downstream portfolio needs (end users, sales to alternative suppliers, sales on the wholesale markets, etc.). Use of the fleet’s various components is managed by giving priority, at any given time, to the generation type offering the lowest variable costs: run-of-river hydropower plants are used for base generation; nuclear plants, because of their low variable generation costs, are used for base and mid-merit generation; adjustable hydropower generation (coming from dams) and thermal fleet are used for mid-merit and peak generation; a significant standardised fleet of nuclear facilities, for which EDF provides full ■ control over their entire life cycle. Moreover, EDF is working towards extending the operating lifespan of its power plants and improving their technical performance; a fleet generating at 87% without CO 2 emissions due to the predominance of ■ nuclear and hydropower generation facilities, in an increasingly restrictive environmental regulatory context; a geographical position at the junction of electricity exchanges between the ■ continental platform and the electric peninsulas (Italy, Spain and the UK). Composition and specifications of the installed fleet With a total installed generation capacity of 92.3GW in mainland France (7) at 31 December 2017, EDF has the largest generation fleet in Europe, accounting for nearly 9% of the total installed capacity in the main European countries (the 35 member areas of ENTSO-E – European Network Transmission System Operators for Electricity – that includes Germany, Italy and Spain (8) ).

Excluding interim interest and the currency effect compared with a benchmark project exchange rate of £1 = €1.23. (1) Transmission network operator, independently managed within the meaning of the French Energy Code. (2) Source: EDF. Figures calculated according to consolidation accounting rules. (3) Source: comparison based on data published by these ten groups. (4) One customer can have two customer accounts: one for electricity and another for gas. (5) Variable generation costs correspond to all the costs that vary directly with the amount of energy generated. Variable costs for electricity generation are mainly fuel costs. (6) For Corsica and the French overseas departments, see section 1.4.4.3 “Island Energy Systems”. (7) Calculation based on the ENTSO-E statistics for the year 2015, as the statistics for the year are only available on 30 April of the following year. (8)

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DF I Reference Document 2017