Universal Registration Document 2020

These revisions were undertaken because work resumed earlier than had been expected when the 16 April estimate was published. The duration of scheduled outages in 2020 was adjusted in view of the observed on-site conditions for the return to work. EDF was able to complete several outages of the 2020 programme during the first half of the year, and continue work on reactors still in operation, while respecting the required measures to prevent the spread of the virus, by optimising movements into and out of restricted-access areas through adjustments to the organisation of work so as to limit the number of people working on the same activity, or using work-from-home arrangements. As a result of the Covid-19 pandemic, the second half of the year began with more reactors on scheduled outages for maintenance than initially planned.

Thanks to better performances than expected on maintenance outages during the second half of the 2020, it was possible to re-estimate nuclear power output for the year at 325-335TWh on 13 November, then announce that it would be close to 335TWh on 16 December 2020. In the end nuclear output for 2020 stood at 335.4TWh, 44.1TWh lower than in 2019 due to the direct and indirect effects of the Covid-19 pandemic totalling 32.9TWh (modulation in response to demand and the timing of outages; constraints associated with measures to prevent the spread of the virus, affecting work during outages). As well as the impacts of the pandemic, the decrease in nuclear power output compared to 2019 is mainly attributable to the shutdown of the two Fessenheim reactors, and prolongation of three complex outages.

Support for customers and suppliers

As set out in the press release of 16 April 2020 ⁽¹⁾, EDF introduced specific measures to support its customers in the context of the Covid-19 pandemic.

During France’s first official public health emergency period, from 24 March to 10 July, EDF decided to guarantee the power supply for all residential customers by suspending all reductions and cut-offs of electricity and gas supplies, and all late payment penalties, until 1 September 2020, and to support customers in difficulty by offering more flexible payment terms and deadlines. The Company thus took steps that went further in both scope and duration than the measures introduced by the French government (such as extending the period when tenant evictions and customer power cut-offs are banned, which normally covers the winter months, to 10 July 2020).

For business customers, EDF took all the necessary measures to grant payment deferrals requested by customers eligible for the national Solidarity Fund, in compliance with the ordinances and decrees adopted by the government. The small businesses concerned were entitled to request deferred payment of invoices falling due until the end of France’s first public health emergency period (10 July 2020). The deferred amounts were spread over a 6-month period from the last day of the month following that date.

The French government then declared a second public health emergency period from 17 October 2020, initially until February 2021 but later extended to 1 June 2021. For residential customers, EDF took further measures in addition to the standard winter ban on evictions and power cut-offs that begins in France on 1 November: to protect customers in difficulty, EDF decided to suspend all power reductions until 15 January 2021, not to apply late payment penalties to invoices issued during the period, and to allow customers extended payment deadlines. The higher risk of non-recovery associated with these measures is incorporated into calculation of the provisions for customer receivables at 31 December 2020 (see note 2.1.2). For business customers, EDF was prepared to allow deferred payment on invoices as required by the French law of October 2020 on the Covid-19 emergency as soon as its application decree defining the scope of customers concerned was published. As that decree has not yet been published, debt collection on the business customer segment remained in line with normal laws and no specific measure has been applied by EDF.

In addition, as explained in the press release of 2 April 2020⁽²⁾, to support its very small, small and medium-sized suppliers in the economic slowdown caused by the pandemic, the EDF group decided to settle its suppliers’ invoices sooner than the contractual 60-day period in France. This initially applied to completed services that had been validated by EDF at 31 March 2020: EDF SA paid its very small suppliers by mid-April and its small and medium-sized suppliers by the end of April, with no intervention required of the supplier. Enedis also took equivalent measures. The first wave of faster payments concerned more than twenty thousand invoices amounting to a total of around €190 million for the entire Group in France. The practice was then progressively extended until the end of the first half-year, in line with the first emergency period which ended on 10 July 2020. In the period from April to June 2020, EDF thus settled nearly €261 million of invoices before the contractual deadline for very small, small and medium-sized suppliers in France. These measures taken in the first half-year have no impact on EDF’s working capital at 31 December 2020.

Estimated impacts of the Covid-19 pandemic on the income statement for 2020

In accordance with AMF (French market regulator) and ANC recommendations, EDF has not applied any different classifications as a result of Covid-19 from those normally used in its income statement. In-depth analyses were conducted in EDF’s local entities and centrally for the half-year closing at 30 June 2020, then the annual closing at 31 December 2020, to prepare reliable estimates of the impacts of the pandemic on EDF’s financial statements. The main estimated impacts of the Covid-19 pandemic on items of EDF’s income statement are presented below.

The pandemic’s impact on sales at 31 December 2020 is estimated at a negative €1,117 million (or around -2.5% of total sales), reflecting the lower nuclear power output and a decline in demand for electricity which led to sales on the wholesale markets at lower prices.

The estimated impact of the Covid-19 pandemic on the CSPE (recognised in operating subsidies) is a €37 million decrease, explained by the lower surplus costs for energy purchases and generation due to lower demand for electricity in the island territories (non-interconnected zones).

The impact of the Covid-19 pandemic on fuel and energy purchases at 31 December 2020, due to the decline it caused in nuclear power output and demand for electricity and gas, is an estimated decrease of approximately €203 million.

The pandemic also had an estimated downward impact of €260 million on services and other purchases used, reflecting several types of effect:

• a decrease of €105 million in delivery expenses, in line with the decline in demand for electricity;
• slowdowns or deferrals of on-site work in the Group’s various businesses led to lower non-capitalisable purchases;
• additional expenses incurred in connection with the Covid-19 pandemic (protective equipment, hand sanitiser, etc.);
• ower purchases as a result of the lockdown and various measures introduced by the public authorities, for example restrictions on movement and requiring people to work from home (less travel, training and seminars, etc.).

Personnel expenses increased by some €68 million, principally in connection with the business recovery plan introduced by the Company. This amount includes the unfavourable effect of the pandemic in terms of charges for employee holiday pay.

Finally, provisions and impairment net of reversals were adversely affected to the extent of some €118 million, including €85 million following revaluation of impairment of trade receivables and €45 million due to an increase in decommissioning provisions for permanently shut-down nuclear power plants where decommissioning work had to be postponed.

The above estimated impacts were prepared from specific reporting set up by EDF as part of the closing for the financial statements, applying the following approaches:

• effects associated with downturns in business levels or deferrals of site work are based on detailed comparative analyses with the corresponding period of 2019, or infra-annual forecasts; impacts on sales due to lower demand for electricity and gas are based on analyses founded on consumption forecast models that take account of other effects (weather effects, portfolio changes, etc.); impacts on nuclear power output are based on analyses of generation by plants in operation (particularly for modulation) and detailed analyses of outages for units that had a scheduled outage in 2020 after the pandemic crisis began, whether for fuel reloading or for regular maintenance, by comparison of activities and time spent on outages in the crisis context in 2020 with a model of outages and the actual work completed in 2019;