Universal Registration Document 2020

This decree and ministerial order require the discount rate to comply with two regulatory limits from 1 July 2020. It must be lower than:

a regulatory maximum, now expressed in real value, i.e. net of inflation; this value is equal to the unrounded value representative of expectations concerning the real long-term interest rate, as used for the calculation of the Ultimate Forward Rate (UFR) applicable at the date concerned published by the European Insurance and Occupational Pensions Authority (EIOPA), plus 150 bp. This maximum is applicable from 2024. Until 2024, the maximum is the weighted average of 2.3% and the above calculation. The weighting applied to the 2.3% rate is set at 50% for 2020, 25% for 2021, 12.5% for 2022 and 6.25% for 2023; and
the expected rate of return on assets covering the liability (dedicated assets)

The maximum discount rate under the new ministerial order effective from 1 July 2020, calculated by reference to the UFR, is 2.7% (real rate of 2.66% rounded up to 2.7%) at 31 December 2020.

The real discount rate used in the financial statements at 31 December 2020, in application of the methodologies presented above, is 2.1%.

The maximum discount rate in nominal value, based on the regulation applicable before the ministerial order of 1 July 2020 and calculated by reference to TEC 30 rates, was 3.8% (3.75% rounded up to 3.8%) at 31 December 2019. The nominal discount rate used in the financial statements at 31 December 2019 was 3.7%.

The decree of 1 July 2020 also introduced the following additional changes:

it removed the obligation to add to dedicated assets when the coverage rate of obligations is above 100%, and raised the threshold above which withdrawals can be made from dedicated assets from 110% to 120%;
it extended the period for making additions to dedicated assets in the event of a shortfall in coverage, after approval by the administrative authority, to 5 years compared to 3 previously;
it added requirements for internal control and risk analysis on nuclear provisions, which operators must implement by 31 December 2021.

Analyses of sensitivity to macro-economic assumptions

Sensitivity to assumptions concerning costs, inflation rate, long-term discount rate, and disbursement schedules can be estimated through comparison of the gross amount estimated under year-end economic conditions with the present value of the amount.

Provisions related to nuclear generation within the scope of the Law of 28 June 2006	31/12/2020		31/12/2019
(in millions of euros)	Costs based on year-end economic conditions	Amounts in provisions at present value	Costs based on year-end economic conditions	Amounts in provisions at present value
Spent fuel management	Spent fuel management 31/12/2020 18,998	Spent fuel management 31/12/2019 10,246	18,437	9,804
amount unrelated to the operating cycle	amount unrelated to the operating cycle 31/12/2020 2,727	amount unrelated to the operating cycle 31/12/2019 1,297	2,491	1,152
Waste removal and conditioning	Waste removal and conditioning 31/12/2020 -	Waste removal and conditioning 31/12/2019 -	1,243	805
Long-term radioactive waste management	Long-term radioactive waste management 31/12/2020 35,580	Long-term radioactive waste management 31/12/2019 13,300	32,372	10,531
BACK-END NUCLEAR CYCLE EXPENSES	BACK-END NUCLEAR CYCLE EXPENSES 31/12/2020 54,578	BACK-END NUCLEAR CYCLE EXPENSES 31/12/2019 23,546	52,052	21,140
Decommissioning of nuclear plants in operation	Decommissioning of nuclear plants in operation 31/12/2020 19,693	Decommissioning of nuclear plants in operation 31/12/2019 12,775	21,134	13,244
Decommissioning of shut-down nuclear plants	Decommissioning of shut-down nuclear plants 31/12/2020 7,400	Decommissioning of shut-down nuclear plants 31/12/2019 4,714	6,428	3,693
Last cores	Last cores 31/12/2020 4,258	Last cores 31/12/2019 2,711	4,331	2,624
DECOMMISSIONING AND LAST CORE EXPENSES	DECOMMISSIONING AND LAST CORE EXPENSES 31/12/2020 31,351	DECOMMISSIONING AND LAST CORE EXPENSES 31/12/2019 20,200	31,893	19,561
PROVISIONS RELATED TO NUCLEAR GENERATION within the scope of the law of 28 June 2006	PROVISIONS RELATED TO NUCLEAR GENERATION within the scope of the law of 28 June 2006 31/12/2020	PROVISIONS RELATED TO NUCLEAR GENERATION within the scope of the law of 28 June 2006 31/12/2019 43,746		40,701

The cumulative disbursements of nuclear expenses (based on gross values at year-end economic conditions) are distributed as follows:

Provisions related to nuclear generation within the scope of the Law of 28 June 2006	31/12/2020
	Costs based on year-end economic conditions
(in millions of euros)	Disbursement expected within 10 years	Disbursement expected after 10 years	Total
Spent fuel management	Spent fuel management 31/12/2020 7,176	11,822	18,998
amount unrelated to the operating cycle	amount unrelated to the operating cycle 31/12/2020 239	2,488	2,727
Long-term radioactive waste management	Long-term radioactive waste management 31/12/2020 5,094	30,486	35,580
BACK-END NUCLEAR CYCLE EXPENSES	BACK-END NUCLEAR CYCLE EXPENSES31/12/2020 12,270	42,308	54,578
Decommissioning of nuclear plants in operation	Decommissioning of nuclear plants in operation 31/12/2020 707	18,986	19,693
Decommissioning of shut-down nuclear plants	Decommissioning of shut-down nuclear plants 31/12/2020 2,756	4,644	7,400
Last cores	Last cores 31/12/2020 848	3,410	4,258
DECOMMISSIONING AND LAST CORE EXPENSES	DECOMMISSIONING AND LAST CORE EXPENSES31/12/2020 4,311	27,040	31,351

*Over a 20-year and 50-year horizon, 22% and 40% respectively of cumulative disbursements (at year-end economic conditions) will concern long-term radioactive waste management provisions, and 47% and 96% respectively will concern decommissioning provisions.

Universal Registration Document 2020

6. Financial statements

Analyses of sensitivity to macro-economic assumptions