Under the Euro Medium Term Note Programme ... - Finance - EDF

Risk Factors
The EDF Group must comply with increasingly restrictive environmental and public
health regulations, which generate costs and are sources of potential liability
The EDF Group’s activities are subject to environmental protection and public health
regulations, which are increasingly numerous and restrictive. These regulations relate to the
EDF Group’s energy generation, transmission and distribution industrial activities, as well as
to energy supply and energy-related services, which must, for example, incorporate the
concept of demand management in their offers. Failure to comply with these regulations
could expose the EDF Group to significant litigation. The EDF Group could be found liable,
even if it is not at fault or has not breached applicable regulations. Furthermore, the EDF
Group may be compelled to compensate breaches, damage or injuries caused by entities
that were not part of the EDF Group at the time they were committed, if the EDF Group
thereafter takes over their facilities.
Furthermore, these regulations may be significantly reinforced by the national or European
authorities, which would have a negative impact on the EDF Group’s activities and financial
results.
Current regulations, and future changes to such regulations, have resulted and are likely to
continue to result in an increasing level of operating costs and investments in order to
comply with such regulations. The EDF Group may even be required to close facilities that
cannot be made compliant with new regulations. In addition, other regulations, which may be
more restrictive or which may apply to new areas which are not currently foreseeable, may
be adopted by the competent authorities and have a similar effect.
In addition, stakeholders’ external perception of the EDF Group’s sustainable development
policy may change, resulting in a deterioration of the EDF Group’s non-financial rating and
image.
Changes to regulations concerning energy savings certificates (ESC) could impose
additional obligations on EDF and generate costs in relation thereto
The energy savings certificates (ESC) measure, which was created by Programme law nº
2005-781 of 13 July 2005 setting energy policy guidelines (POPE Act) and its implementing
decrees, as amended by the Grenelle 2 law of 12 July 2010, and which is now codified as
Articles L. 221-1 et seq. of the French Energy Code, imposes energy savings obligations on
energy suppliers.
In accordance with the conditions and procedures specified in the regulations, three-year
energy savings objectives were established and allocated among persons subject to the
obligation to achieve energy savings (the “obligors”) on the basis of their sales volumes. This
objective was 54 cumulative discounted TWh for the first period between 1 July 2006 and 30
June 2009. The second period covers 1 January 2011 to 31 December 2013 and the
objective is 345 cumulative discounted TWh. Subject to financial penalties, payment of which
discharges liability, by the end of the relevant period, obligors must produce energy savings
certificates corresponding to their obligation, which are obtained in exchange for directly or
indirectly carrying out energy savings actions, or which may be purchased from other socalled
“eligible” economic entities through the national certificates register.
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