EDF is modernising its fleet of natural gas CCGT plants (Blénod, Martigues, Bouchain) to reduce air emissions of CO2, NOx and SO2. The Bouchain plant in particular produces CO2 emissions of around 360g/kWh on average.
In the island territories, electricity is principally generated by an oil-fired fleet (with net book value of €2.2 billion), and to a smaller degree hydroelectric plants and renewable energy plants. Where required by the Multi-year energy programme, EDF intends to operate new plants running on liquid biomass, or to convert its existing plants to run on bioliquid.
In Italy, Edison’s thermal fleet consists of CCG plants. In keeping with the “National plan for energy and the climate” supporting development of gas-based electricity generation and its integration with renewable energy generation, in 2019 Edison started to build the first new-generation CCG plant at the Marghera Levante site (780MW). This was followed in 2020 by the start of work on a 760MW greenfield project at Presenzano (in Campania), using the same technology, for low environmental impact (CO2 emissions 40% below the national average, and a 70% reduction in NOx emissions). These two facilities should be commissioned in 2022 and 2023 respectively.
Since 2013 the Group has made six Green Bond issues for a value equivalent to €8.7 billion, in order to support its development in renewable energies. It has invested around €2.5 billion per year to such operations.
After the two Green Bond issues chiefly intended to finance the building of new wind and solar power projects by its subsidiary EDF Renewables (€1.4 billion in November 2013 and $1.25 billion in October 2015), the Group expanded its Green Bond Framework to finance investments in the renovation and modernisation of its hydropower assets in mainland France.
The new Framework was first applied to a €1.75 billion issue in October 2016 and then to a JPY 26 billion issue in two tranches in January 2017. The Group extended the scope of its Green Bond Framework further in early 2020 by opening it up to international hydropower assets, energy efficiency projects and biodiversity conservation projects.
On 8 September 2020, EDF made a landmark offering of unsecured senior Green Bonds convertible into new shares and/or exchangeable for existing shares of the Company (OCEANEs Vertes) maturing in 2024, for the nominal amount of approximately €2.4 billion.
On 23 November 2021, EDF launched a senior Green Bond issuance maturing in 2033, for a total amount of €1.75 billion with a fixed 1% coupon.
The Green Bonds are included in the Group’s borrowings, see note 18.3.2. Allocation of the funds raised by EDF’s Green Bond issues is certified by one of the Statutory Auditors: see section 6.7 of the Universal Registration Document.
On 26 May 2021 EDF launched an issue of Euro-denominated perpetual social hybrid notes with total nominal value of €1.25 billion and an initial coupon of 2.625% and a first redemption at the option of EDF on 1 June 2028.
The funds raised will be used to finance eligible projects, as defined in the EDF group’s Social Bond Framework. These projects include capital expenditure contracted with Small and Medium-Sized Enterprises (SMEs) which contributes to the development and maintenance of electricity generation and distribution assets in Europe (including the United Kingdom). To qualify for funding, SMEs must meet three criteria: (1) a workforce of fewer than 250 people; (2) annual sales of less than €50 million or a balance sheet total of less than €43 million; (3) a 25% or lower ownership interest in a group. Criterion (3) makes EDF’s definition more restrictive than the EU definition.
The Social Bond Framework’s compliance with the Social Bond Principles published by the International Capital Markets Association (ICMA) was validated by S&P Global in a Second Party Opinion published in May 2021. EDF’s social bond programme is in line with the Group’s CSR objectives regarding responsible development of local areas and responsible development of industrial sectors.
A provisional impact report on these investments was published on the EDF group’s website on 10 November 2021.
Allocation of the funds raised by EDF’s social bonds is audited by one of its Statutory Auditors (see section 6.8 of the 2021 Universal Registration Document).
These perpetual social hybrid notes are recorded in equity (see note 14.4).
The EDF group is strongly committed to corporate social responsibility (CSR) and advocates closer ties between non-financial performance and financing strategy.
The credit lines indexed to the Group’s sustainable development performance incorporate a cost adjustment mechanism.
EDF SA has a €4 billion “green” syndicated credit line with more than 20 banks that incorporate a margin adjustment mechanism linked to Group performance on three KPIs: direct CO2 emissions, French residential customers’ use of online consumption monitoring tools, and electrification of EDF’s light vehicle fleet.
In December 2021 EDF also signed a new €1.5 billion “social” credit facility with 9 banks. The initial maturity is three years and the cost will be indexed on four KPIs focused on EDF’s Fair and Inclusive Transition principles in favour of all stakeholders: employees, customers, suppliers and the communities where the Group operates.
At the end of 2021, the Group also signed 15 renewable bilateral credit lines indexed on ESG criteria (incorporating a cost adjustment mechanism based on the Group’s performance on certain KPIs or its rating by a nonfinancial ratings agency), amounting to a total €3.84 billion.
At 31 December 2021, undrawn ESG-indexed renewable credit lines lines (including syndicated credit facilities), which were undrawn, totalled over €9.3 billion, or 72% of the EDF group’s total undrawn credit facilities (see note 18.4).
The selected KPIs reflect the EDF group’s major environmental commitments, principally cutting greenhouse gas emissions (CO2) by 50% by 2030, closing down coal-fired plants in France and the United Kingdom with a view to achieving carbon neutrality by 2050, and completing electrification of the whole EDF group vehicle fleet by 2030. The focus on consumption monitoring tools reflects the Group’s ambition to provide its customers with energy solutions appropriate to their needs.
In 2021 the Group continued its programme of gross operating investments, which amounted to €18.3 billion and included €17.6 billion of gross investments in intangible assets and property, plant and equipment (see notes 4 and 10.7) and €0.7 billion of gross financial investments.
In 2021, nearly 94% of the Group’s investments were in line with its net-zero trajectory (94% in 2020), with 50% of investments concerning the nuclear sector (51% in 2020). 40% of the Group’s investments are aligned with the European sustainable taxonomy (43% in 2020 applying the method based on the March 2020 TEG (technical expert group) report). This notably covered investments in networks, renewable energy production (hydropower, solar power, wind power) and certain energy services (presented in the Group’s report on its non-financial performance, in section 3.8.3 “Details on the taxonomy” of the 2021 Universal Registration Document).
