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BUSINESS OVERVIEW
06
6.4 Operations
Note:
Due to the decisions described above and pursuant to IFRS 5, the Wind Energy,
Solar Energy and Energy Storage businesses made no contribution to the group’s
intermediate balances or revenue.
Despite the decision to shut down the Bioenergy operations, they remained within
the consolidation scope of the group’s intermediate balances and consolidated
revenue in 2016; the final shutdown of the business will not be completely effective
until the last project has been completed.
6.4.3.2.1.
Bioenergy
Operations and highlights
BIOENERGY EUROPE
In 2016, the principal operating activity of the Bioenergy Europe entity was the
continued turnkey construction of the Commentry biomass cogeneration power
plant for the independent French energy producer Neoen. The power plant will have
15 MWe of electrical power and 50 MWe of thermal power. The construction of
the power plant has experienced delays and is scheduled to be completed during
the third quarter of 2017.
In view of the difficult market conditions and the group’s strategy of refocusing on
businesses related to the nuclear fuel cycle, it was decided in 2015 to terminate
the Bioenergy Europe operations after completion of the Commentry project and
in compliance with all of AREVA’s contractual obligations, in particular as concerns
warranties for operating power plants. Starting in June 2015, the staff of the entity’s
two sites in France and Germany was gradually reduced. In France, employees were
covered by an Employment Preservation Plan with possibilities for redeployment
in the group or departure with support measures. In Germany, an equivalent plan
was deployed in compliance with local procedures. The plan for a gradual exit from
the business continued in 2016 and may be finalized upon the completion of the
Commentry project in 2017.
BIOENERGY ASIA
On February 22, 2016, it was decided to shut down the Bioenergy Asia operations.
A program for a gradual exit from the business and staff reduction was implemented
in 2016, in compliance with AREVA’s contractual commitments. The business no
longer has any projects under construction today and its operations are limited to
managing warranty obligations. Full shutdown should be effective in 2017.
BIOENERGY BRAZIL
OnMarch 8, 2016, the personnel of Bioenergy Brazil were informed of its shutdown.
A program for a gradual exit from the business and staff reduction was immediately
set up, in line with the schedule for completing AREVA’s contractual commitments,
in particular as concerns warranty obligations for the operating power plants. Lastly,
it should be noted that in February 2016 the Bioenergy Brazil entity terminated the
Campo Grande biomass power plant supply project with its customer Atico/Bolt,
in compliance with the terms of the contract. As a reminder, this contract had been
suspended in October 2015 in view of the customer’s difficulties in coming up with
the financing for this project.
6.4.3.2.2.
Energy storage
Hydrogen electrolysis with PEM technology
In 2016, operation continued of AREVA H2Gen, a joint venture created inMay 2014
by its shareholders AREVA Stockage d’Énergie, Smart Energies and the French
Environment and Energy Management Agency (Ademe). The joint venture designs
and manufactures proton exchange membrane (PEM) hydrogen electrolyzers.
AREVA and its partners aim to turn it into a global leader in the hydrogen production
market using electrolysis technology. The company is based in France and operates
an engineering and electrolyzer production site in Ulis.
Themarket for hydrogen production by electrolysis, traditionally focused on industrial
applications, is evolving with the opening of hydrogen vehicle supply stations. Other
applications, such as power-to-gas, offer additional and important avenues for this
business.
Other energy storage operations
Energy storage operations other than PEM electrolysis fall under the responsibility
of AREVA’s Research, Development and Innovation Department, to speed up
development of related technology under collaborative programs. These operations
mainly concern the development of a continuous flow battery technology, with
operation of the first 150-kW prototype starting in 2016.
6.4.3.2.3.
Solar energy
As a reminder, in view of the very unfavorable market conditions for concentrated
solar power, AREVA had decided in August 2014 to stop the Solar Energy operations
at the end of projects nearing completion, unless a full takeover bid was received in
the short term. Unfortunately, detailed discussions conducted in 2015 with potential
buyers did not result in an agreement. Consequently, it was decided to discontinue
these operations completely.
In order to shut down operations, an agreement was reached in December 2015
between AREVA and its customer Reliance Power for the early termination of the
concentrated solar power plant project built by AREVA for Reliance in the State of
Rajasthan, India. The agreement officially transfers the solar field in as-is condition
to Reliance, along with the maintenance and operation of the power plant. This
agreement was effectively executed on February 22, 2016, releasing both parties
from their respective obligations. As a result of this termination and the absence of
any orders in backlog, this decision marks the end of AREVA’s involvement in any
solar energy operation and the discontinuation of that business.
6.4.3.2.4.
Wind energy
Operations and highlights
In offshore wind, on June 17, 2016, Gamesa and AREVA signed an amendment
to the shareholders’ agreement for Adwen, a joint venture in offshore wind energy
held in equal shares by the two groups. Through that amendment, AREVA had
three months to either sell its interest in Adwen to Gamesa or sell 100% of the
shares in Adwen to an independent investor having made a more attractive firm
offer during that period.
At the end of the three-month period, and in the absence of an attractive offer from a
third party, the Board of Directors of AREVA SA decided to authorize Management
to exercise the option to sell its interest in Adwen to Gamesa. This option, which
was exercised on September 14, 2016, closed on January 5, 2017 with Gamesa’s
purchase of the 50% interest in Adwen held by AREVA. This transaction allowed
the AREVA group to:
p
maximize the value of the Adwen shares sold;
p
limit and cap for the long term the amount of cash disbursements related to
projects in operation and in the installation phase;
p
strengthen Adwen’s operations through a stable shareholding structure. In
particular, Gamesa is aware of commitments made by Adwen under requests
for proposals concerning offshore wind power generation inmetropolitan France.
Adwen will continue to carry these commitments.
2016 AREVA
REFERENCE DOCUMENT
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