EDF_REGISTRATION_DOCUMENT_2017

1.

PRESENTATION OF EDF GROUP Description of the Group's activities

Decentralised Energy EDF Énergies Nouvelles Réparties (EDF ENR) is wholly owned by EDF EN. EDF ENR is now an integrated player in decentralised photovoltaic solar power generation, involved in the design, build, operation and maintenance of rooftop installations. EDF ENR Solaire, a wholly-owned subsidiary, markets and installs photovoltaic solar power solutions in France for residential and business customers and local authorities. One year after embracing self-consumption with the “Mon soleil et moi” ("My sun and me") service aimed at residential households, in 2017 EDF ENR Solaire launched the “Notre soleil et nous” ("Our sun and us") service aimed at co-owners, social housing providers and all operators of apartment buildings wanting to generate and consume their own electricity. In addition, EDF ENR is present in the upstream segment. It owns 100% of EDF ENR PWT (Photowatt) which designs and manufactures photovoltaic modules using crystalline silicon technology with various applications ranging from residential equipment to land-based solar farms. In early 2018 Photowatt announced a development project based on a new industrial model on the one hand and its applied R&D on the other hand. The new industrial model entails setting up a new firm called Photowatt Crystal Advanced specialising in the low-carbon production of high-tech silicon ingots and wafers which would be 60% owned by Photowatt, 30% by Canadian Solar Inc – a world leader in the manufacture of solar panels – and 10% by ECM Greentech, a French firm based in Grenoble that has developed an innovative silicon crystallization technology with the INES (the French solar energy research centre). The new firm's generation capacity would gradually reach over 500MWp a year versus the current capacity of 50MWp of Photowatt's existing facility at Bourgoin-Jallieu (38) in the Auvergne-Rhône-Alpes region in France. Alongside this joint project Photowatt would concentrate on its R&D activities, renamed Photowatt Lab, in conjunction with the EDF group's R&D Department and solar energy research centres such as INES or the Photovoltaic Institute of Ile-de-France region with a view to fostering the emergence of new technology in the field of photovoltaic cells and modules and testing it in preindustrial conditions. Storage sector EDF ENR is the controlling shareholder of EDF Store & Forecast, a wholly-owned Group subsidiary. EDF Store & Forecast, founded in March 2014, markets software solutions to forecast, plan and optimise automatic control of renewable energy generation and storage. In a context marked by the strong growth of renewable energy generation and by the closure of large-scale electrical facilities, battery storage technology helps smooth out the generation of electricity of the national grid. The storage system can be activated on the grid in order to respond quickly to fluctuations. In this context, through its subsidiaries, EDF EN develops innovative storage systems in the US, the United Kingdom and France. In 2015, EDF EN announced the commissioning by its North American subsidiary EDF RE of an innovative storage system that combines an energy storage battery and monitoring software. The McHenry facility provides nearly 20MW of capacity (40MW of dynamic capacity) and helps monitor an energy reserve to stabilise the frequency of the electricity grid at a local level. In 2017 EDF EN began construction of a battery storage system with a capacity of 49MW at West Burton in Nottinghamshire in the UK for which it had won a tender in 2016. This facility will be part of the frequency control system, with a total capacity of 200MW, which will be deployed throughout the country. The objective is to improve the stability of the national electricity grid. Lastly, in addition to the Toucan photovoltaic plant with battery storage (5MWp) in French Guiana in operation since 2015, the proposed Toucan 2 photovoltaic plant (5MWp) was chosen in 2017 under the CRE II call for tenders to build and operate photovoltaic facilities with a capacity of more than 100 kWp with battery storage systems located in zones that are not interconnected.

Boasting more than one hundred thousand photovoltaic modules, the future Toucan 2 plant will feature an electrical equipment remote control system developed by EDF Store & Forecast and EDF EN.

1.4.2

SALES AND SUPPLY ACTIVITIES

Presentation of the market in France 1.4.2.1 Demand 1.4.2.1.1 Domestic electricity consumption in France (including Corsica) for the 2017 fiscal year stood at 482TWh (1) , down by 0.3% in comparison with 2016. After adjustment of the weather impact, it was stable. Competition 1.4.2.1.2 Since 1 July 2007 the French market for electricity and gas has fully opened up with each customer able to choose their energy supplier. They may opt at any time, and without advance notice, for an offer at market price from the supplier of their choice. Among the electricity suppliers on the French market, the main competitors of EDF are Engie, E.ON (Uniper, SNET), Enel and Direct Énergie. In the gas market and in the corporate and local authority customer segment, the other major gas suppliers are Tegaz, Eni, Gaz Natural, Gazprom, E.ON (Uniper, SNET) and Antargaz. Lastly, on the gas market and in the retail customer segment, one also finds the suppliers Engie, Direct Énergie and Eni. As of 30 September 2017, according to the CRE (2) , the electricity market shares in terms of sites of alternative suppliers, i.e. excluding historical suppliers, were 16.8% in the residential market, and 19.7% in the non-residential market, and a gas market share, in number of sites, respectively of 25.3% and 40.5%. The 2010 NOME Law established certain rules for the supply of electricity and gas, the main provisions of which, codified today in the Energy Code, are the following: regulated electricity and gas tariffs remained partially unchanged under the ■ conditions described for electricity in section 1.4.2.1.3 “Regulated electricity sales tariff contracts” below; regulated access to historic nuclear power (ARENH) was put into place to the ■ benefit of EDF’s competing electricity suppliers and distribution and transmission network operators (see section 1.4.3.3 “Regulated access to historic nuclear power (Accès Régulé à l’Énergie Nucléaire Historique, or ARENH)”). In order to supply their customers, the electricity alternative suppliers of EDF gained access in 2017 to their own generation capacities as well as to the wholesale electricity market and the ARENH for around 82TWh. During the November 2017 application process alternative providers purchased 94.6TWh for 2018. Regulated electricity sales tariff contracts 1.4.2.1.3 Access to regulated electricity tariffs Since the NOME Law entered into force in 2010, the situation for electricity, by category of customer, is as follows: domestic and non-domestic final consumers who have subscribed power for their ■ site(s) not exceeding 36kVA: these customers benefit from regulated sales tariffs. They can freely switch back and forth between regulated tariffs and market offers; domestic and non-domestic final consumers who have subscribed power for their ■ site(s) exceeding 36kVA: since 1 January 2016 these sites can no longer subscribe to regulated sales tariff products which were cancelled on 31 December 2015; domestic and non-domestic final consumers for their site(s) located in areas not ■ connected to the continental metropolitan network: these customers have the right to regulated sales tariffs;

Source: 2017 Electricity report published by RTE. (1) Source: Energy Regulation Commission (CRE), data at 30 September 2017. (2)

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DF I Reference Document 2017