EDF Energy remains committed to delivering smart meters to all domestic and small business customers who want to benefit from this new technology. In 2019, EDFEnergy has installed a further 550,422 smart meters and by the end of 2019, c.33% of EDF Energy customers in scope for the rollout have smart meters. In total 1.5 million smart meters have been installed to date. By Q1 2019 EDF Energy was able to complete the transition to the second generation smart meters and later in the year started the mass roll out of SMETS2 prepayment meters with EDF Energy having installed c.33,500 of them. In addition to delivering a similar number of installations in 2020, EDF Energy is in consultation with Ofgem regarding future targets and continues to have the full support and commitment of the Board of Directors to ensure it fully delivers on its regulatory commitments.
In the Q4 2019 Citizen’s Advice Complaints (domestic) League Table, EDF Energy scored 4.45 stars (out of 5), rising from the 6th place to 2nd place behind SSE out of the 40 suppliers measured.
In 2019 customers have shown that they are very happy with the service they have received across all channels. The Trustpilot score has increased from 0.9 at the end of 2018 to 4.4 (score out of 5), securing a rating of “Excellent”. The Advisor Recommendation Score(1) has steadily improved through the year to average +53 (on a scale from -100 to +100), with Digital Net Ease score scoring 4.4 out of 5. EDFEnergy continues to work on reducing unnecessary customer contact with 67.5% of transactions completed by customers using inbound self-serve channels.
In 2019, the non-domestic segment supplied a total of 33.47TWh of electricity,2.16TWh to 176k small business customers (“SME”) and 31.31TWh to medium and large business customers (“I&C”) accounts. The business customer electricity market in the UK is c.182.5TWh in total, making EDF Energy the largest supplier to business customers. Almost half of the business electricity market is serviced by just four main players (EDF Energy, npower, SSE and E.On UK).
Medium business has grown throughout 2019; volume has grown by 1TWh since the start of the year driven by improved performance with channel partners. A gas product in this market has also been launched.
In Large Business, Crown Commercial Service (CCS) has chosen EDF Energy to supply the UK’s single largest annual energy supply agreement, for the third consecutive time. The four-year deal will run from April 2020 to March 2024. EDF Energy will be supplying >10 TWh of electricity per year – equivalent of 3.2 million homes – and helping public buildings to become more energy efficient. This contract will also see our MPAN supply increase by 37k MPANs (meter point administration number).
In the Export market, Tesco are entering into a number of long-term Corporate PPAs with renewable generators to support their climate change commitments and EDFEnergy is entering into off-take arrangements with Tesco for each of the sites (total c.322G Wh per year) and will provide balancing, route to market and settlement services for Tesco. The sites will commence operation between 2020 and 2021.
The policies surrounding EDF Energy’s energy purchasing and risk management activities are carried out in accordance with EDF group’s policies and ensure that EDF Energy’s activities are optimised and its services delivered at a competitive price while limiting its gross margin volatility.
The Wholesale Markets Optimisation (WMO) Division’s purpose is to manage the wholesale market risk of EDF Energy in one place within predefined risk limits and control framework. It provides an interface with the wholesale markets, via EDF Trading. WMO also provides modelling services to the whole of EDF Energy, as well as negotiating and managing asset backed commercial structures with third parties e.g. Nuclear Decommissioning Authority and Centrica.
The power generated by the generation fleet is sold via the WMO Division within EDF Energy’s customers business. Since April 2010, 20% of the output from nuclear generation is separately sold to Centrica, the minority shareholder of the current nuclear fleet, under the agreements entered into with Centrica. The remaining 80% is sold to WMO under the same transfer price as used for the transaction with Centrica, based on published market prices, smoothed over forward electricity prices where liquidity allows.
Over and above its own generation, EDF Energy also sources electricity through export power supplied from power purchase agreements which are mainly with renewable and CHP generators. In 2019, EDF Energy acquired approximately 6.4TWh through this channel.
The Powershift platform developed by EDF Energy’s Blue Lab Innovation Department, gained its first customers in 2019. It offers customers flexibility to utilise storage and small scale generation to earn revenues from reducing or shifting energy demand.
For delivery in 2019, EDF Energy’s net position on the wholesale market was a sale of approximately 7.6TWh (including structured trades). In 2019, EDF Energy sold approximately 38.2TWh and bought 30.7TWh(2).
Coal and gas contracts (physical and financial) and CO2 emissions rights are entered by EDF Energy to hedge the fuel requirements of its power plants, gas storage and gas consumers.
Purchases are based on generation forecasts and target fuels stock levels. In 2019, 50% of EDF Energy’s coal deliveries were from domestic suppliers and 50% were from international sources.
Following the final investment decision (FID) made by EDF’s Board of Directors on 28 July 2016, EDF and CGN signed final contracts for the construction and operation of two EPR reactors on Hinkley Point site in Somerset (“Hinkley Point C” or “HPC”project).
At the same time, agreements were signed for the development in the UK of two nuclear power plants at Sizewell in Suffolk (“Sizewell C” project, based on UK EPR technology) and Bradwell in Essex (“Bradwell B” project, based on UK HPR1000 technology) and the delivery of the Generic Design Assessment for the UK HPR1000 technology.
The EPR technology is already being deployed at the power stations at Flamanville in France (currently under construction and fully owned by EDF – see section 1.4.1.2.1“Flamanville 3 EPR project”) and at Taishan in China (active, see section 1.4.1.2.2“Other New Nuclear projects – Taishan EPR”).
EDF’s share in HPC is 66.5% and CGN’s share is 33.5%.
EDF has taken note of the British Government requirement not to have the control of HPC sold down during the construction period without the previous approval of the British Government.
(1) Advisor Recommandation Score.
(2) The difference is due to the rounding of figures.
