Since the enactment of the French Law of 8 April 1946, EDF, and subsequently Enedis, has been the concession operator of most of the public distribution networks in France.
SEI is the concession operator for distribution network zones that are not interconnected with the network in mainland France, under identical concession regulations to Enedis.
Électricité de Strasbourg is the concession operator for public distribution networks in a limited zone depending on a non-nationalised distributor, in application of the Law of 8 April 1946.
In accordance with France’s Energy Code and Local Authorities Code, the public distribution of electricity is principally operated under the public service concessions system. The authorities granting the concessions (local authorities or public establishments for cooperation acting as an Energy Distribution Organisation Authority (Autorité organisatrice de la distribution d’énergie – AODE)) organise the public electricity distribution service through concession agreements with specifications that define the respective rights and obligations of the parties. Enedis distributes electricity to 95% of the population of mainland France under such concessions, with 415 concession agreements at 31 December 2021. The other 5% are served by Local Distribution Companies (including Électricité de Strasbourg).
Enedis’ concession agreements correspond to different models depending on the date of signature.
The 1992 concession specifications model (updated in 2007) was negotiated with the FNCCR (National Federation of licensing authorities) and EDF, and approved by the public authorities. This model places Enedis under an obligation to record industrial depreciation and establish provisions for replacement.
On 21 December 2017, the FNCCR, France Urbaine, EDF and Enedis signed a framework agreement for a new concession agreement model. This new model modernises the relationship between Enedis and concession-granting authorities in the long term and reflects the parties’ attachment to the principles of French concessions for electricity distribution: public service, regional solidarity and national optimisation. The FNCCR and France Urbaine represent the concession-granting authorities, particularly towns, syndicated municipalities, boroughs and major cities when they are the authorities with competence to grant public electricity distribution concessions.
As of 2018, newly-signed concession agreements apply the concession agreement model validated on 21 December 2017. At the effective date of a new agreement, the existing special concession liabilities recorded in application of the previous concession agreement to represent the concession-granting authority’s rights in the concession assets remain in the accounts. Like earlier concession agreements signed since 2011, the contractual obligation to establish provisions for replacement no longer exists, and the governance of investments is different.
To provide an effective public service, the distribution network operator and the concession-granting authority now agree to jointly set up a governance system to oversee investments in the public electricity distribution network over the area covered by the concession, including replacement of infrastructures. This system mainly takes the form of a master plan taking a long-term view of developments in the network over the concession area, and multi-year investment plans (programmes pluriannuels d’investissements – PPIs) for 4 and 5-year periods that are medium-term applications of the master plan.
PPIs contain detailed objectives for each investment purpose, concerning a selection of quantified, localised investments with financial valuations for the duration of the plan.
PPIs are revised when necessary, after consulting with Enedis and the authority granting the concession, to take account of changes in each party’s investment priorities and financial resources.
If it were observed at the end of a PPI that any investment concerned by Enedis’ financial commitment had not been made, the concession-granting authority could oblige Enedis to deposit a sum equal to 7% of the investments still to be made. This deposit would then be returned or retained after a two-year period, depending on the investments made by that time.
In accordance with the agreement reached in late 2017 with the FNCCR and France Urbaine, negotiations for concession renewals continued in the regions of France during 2021. By 31 December 2021, 291 concession agreements had been concluded under the new model, for local projects with all kinds of concession-granting authorities: syndicated counties, two individual counties (départements), syndicated municipalities, major cities, urban boroughs, conglomerations and towns.
Added to the 41 previously renewed or amended concessions that contain stipulations similar to the new model, these 291 concessions bring the total number of modernised concession agreements to 332 of the 364 that are due for renewal. Negotiations are continuing with a view to renewing the small number of remaining agreements, mostly old-model agreement with syndicated counties.
