The compensation paid under the terms of this protocol will comprise:

• initial instalments to compensate for expenses incurred after the closure of the plant (end-of-operations expenditure, BNI taxes, dismantling costs and staff redeployment costs), which will be paid over a 4-year period following the closure. These payments are expected to amount to a total of nearly €400 million.This compensation will be recognised as income in profit and loss as and when the associated costs are incurred;
• subsequent payments corresponding to the lost income that would have been generated by future power generation up until 2041, based on Fessenheim’s previous output figures and calculated “ex post” on the basis of nuclear power sale prices, particularly observed market prices.

3.2 Disposals

3.2.1 Disposal of EDF’s 25% stake in Alpiq

On 4 April 2019, following the approval given by their respective governance bodies, EDF, EBM (Coopérative Elektra Birseck) and EOS (EOS Holding SA) signed an agreement on EDF’s disposal of its stake in Swiss power producer Alpiq (25.04% of the company’s capital and voting rights) to EBM and EOS (each entity acquiring half of this stake).

This operation valued EDF’s stake in Alpiq at approximately CHF489 million (around €434 million), based on a purchase price of CHF70 per Alpiq share. It reduced the Group’s net indebtedness by €434 million. The Shares Purchase Agreement includes potential earn-out mechanisms. The sale was completed on 28 May 2019 after it received clearance from the German competition authority.

The impact on the consolidated net income is not significant.

3.2.2 EDF notifies the exercise of its put option on its investment in CENG

Pursuant to the agreements concluded with Exelon in 2014⁽¹⁾, EDF notified Exelon on 20 November 2019 the exercise of its put option on 49.99% of the shares of CENG.

CENG owns five nuclear reactors across three nuclear power plants located in the states of New York and Maryland, with total capacity of 4,041MW (company-owned capacity).

This put option was exercisable by EDF from 1 January 2016 to 30 June 2022. The transaction price will be based on the fair market value of CENG shares, determined pursuant to the contractual provisions of the put option agreement.

Completion of the transaction will be conditional upon obtaining the required regulatory approvals.

This sale of CENG shares is part of the disposal plan concerning non-core assets announced by EDF Group.

The Group has reclassified its investment in CENG as assets held for sale (see note 46).

3.3 Financing operations

3.3.1 Signature of three credit lines indexed on ESG criteria

Through these new agreements, which form a continuity with two other credit lines indexed on the Group’s sustainability performance signed in 2017 and 2018, EDF is reaffirming the central role of sustainable financing instruments in its finance strategy. ESG-indexed renewable credit lines total more than €5 billion at 31 December 2019, accounting for around 48% of the EDF group’s credit lines.

On 22 March 2019 EDF and BBVA signed a €300 million revolving credit facility.

On 22 July 2019 EDF signed two €300 million revolving credit facilities. One is with the Crédit Agricole Group, led by Crédit Agricole CIB and including LCL and Crédit Agricole d’Ile-de-France, and the other is with Société Générale CIB.

These three credit facilities incorporate an adjustment mechanism that links their cost to three of the Group’s sustainability KPIs: direct CO2 emissions, use of online consumption monitoring tools by its French residential customers (as a proxy for EDF’s success in getting French residential customers actively engaged with their energy consumption), and electrification of its light vehicle fleet.

3.3.2 Issuance of perpetual subordinated bonds

On 26 November 2019, EDF issued a euro-denominated 500 million hybrid bond, with a 3.00% coupon and an 8-year first call date.

This offering shows the Company’s strong commitment to financing through hybrid securities, which are a permanent part of its capital structure. The Company pro-actively manages its stock of hybrid bonds: the funds resulting from this issue were mainly used to finance the partial repurchase of several outstanding series of hybrid bonds, and for general corporate purposes of the Company and the EDF Group, as the case may be.

In compliance with IAS 32, the issuance of perpetual subordinated bonds (see note 1.3.19.4) was recorded in equity upon receipt of the funds, at the amounts of €493 million net of expenses.

3.3.3 Redemption of certain series of hybrid bonds

On 26 November 2019, EDF issued a cash tender offer for redemption of the following hybrid bonds:

• €1,000 million Reset Perpetual Subordinated Notes with a first redemption at the option of the Company on 22 January 2022, which are admitted to trading on Euronext Paris, of which €661.8 million was outstanding. The amount redeemed amounted to €394.9 million and settlement took place on 13 December 2019;
• $3,000 million Reset Perpetual Subordinated Notes with a first redemption at the option of the Company on 29 January 2023, which are admitted to trading on the regulated market of the Luxembourg Stock Exchange, of which $3 billion was outstanding. The amount redeemed amounted to $902.4 million and settlement took place on 31 December 2019.

EDF also exercised its option to fully redeem the €1.25 billion Reset Perpetual Subordinated Notes, of which €338.2 million was outstanding, on 29 January 2020. As the redemption was certain, EDF reclassified these equity instruments as financial liabilities at 31 December 2019 in the amount of €338.2 million (see note 30.4).

Consequently, taking into account the issuance on 26 November 2019 of a €500 million hybrid bond with 3.00% coupon and an 8-year first call date (see note 3.3.2), these transactions reduced the total stock of hybrid instruments in EDF’s balance sheet by approximately 8% to €9.8 billion while generating a saving net of interest estimated at around €44 million in 2020 and around €58 million from 2021.

In compliance with IAS 32, this redemption of perpetual subordinated bonds (see note 1.3.19.4) was recorded in equity upon disbursement of the funds or when the redemption commitment was made, at the amount of €1,618 million net of expenses.

(1) EDF Press Release of 1 April 2014 “EDF and Exelon finalize agreement on CENG”.