Universal Registration Document 2021

1.4.2 Sales and supply activities in France

Besides gas and electricity supply, EDF accompanies its customers by offering a wide range of services and energy solutions. EDF aspires to be a trusted partner for customers, engaging in responsible marketing and providing simple, intelligible offers.

1.4.2.1 Presentation of the market in France

1.4.2.1.1 Competition

Since 1 July 2007, the French market for electricity and gas has fully opened-up, allowing each customer to choose their energy supplier.

Over the last six years, the number of active electricity suppliers in France excluding historical suppliers has more than doubled, from 24 at end-2015 to 51 at 30 September 2021⁽¹⁾.

In the electricity and gas markets, many suppliers have been proposing offers to businesses and local authorities since the early 2000’s. For residential customers, competition has intensified significantly since 2017 with the entry into the market for gas and electricity suppliers well established in other activities or geographical areas.

To supply their customers in 2021, EDF’s alternative suppliers had access to their own generation capacities as well as to the wholesale electricity market and the ARENH for around 100 TWh. During the November 2021 application process, the demand from alternative providers for the 2022 delivery year reached 160.33TWhfor an ARENH distribution volume of 100 TWh (see also section 1.4.3.3 “Regulated access to historic nuclear power (Accès Régulé à l’Énergie Nucléaire Historique, or ARENH)”).

On 13 January 2022, given the context of rising electricity prices, the French government announced an exceptional increase of 20 TWh in the ARENH volume that will be delivered in 2022, at a price of €46.2/MWh.

The Government published on 12 March 2022 in the Official Journal the Decree⁽²⁾ and Orders dated 11 March 2022 relating to the additional allocation of 20 TWh of ARENH volumes for 2022. The Decree provides that eligible suppliers, in order to benefit from the additional ARENH volumes over the period from 1 April to 31 December 2022 at the price of €46.2/MWh, will have to sell EDF the same volume that will be transferred to them by EDF under this additional allocation, at a price equal to the average of the wholesale forward prices recorded between 2 and 23 December 2021, for electricity delivery in mainland France in 2022, i.e. €257/MWh. The CRE will distribute the additional ARENH volumes between the suppliers, in the same way as the one that was followed for the delivery period started on 1 January 2022. This decision sets the purchase price for EDF of the additional ARENH volumes of 20 TWh which will have to be made available to suppliers in 2022. Following the publication of the ARENH decree and orders, EDF is studying all possibilities to preserve its interests.

See also in chapter 2 “Risk Factors and Control Framework”, risk 1A dissection 2.2.1 “Public policy and regulatory framework developments in France and in Europe in particular ARENH”.

Regulatory notice

The Energy Regulation Commission (CRE)

The CRE is an independent administrative authority. Its responsibility is to ensure the proper workings of the electricity and natural gas markets for end consumers. In this respect, the CRE ensures, in particular, that the conditions for access to electricity and natural gas transmission and distribution networks do not impede the development of competition.

The CRE has significant powers: the power to make proposals, advisory powers and decision-making powers (approval power and regulatory power). The CRE makes proposals, in particular:

• to the Ministers for the Economy and for Energy regarding the amount of the costs that are attributable to the public service missions assigned to power producers, and the net amount of the related contributions;
• regarding the ARENH price once the Decree has been published that specifies the methods for identifying and recognising the costs that are taken into account for the calculation of the ARENH price.

Moreover, it has been the CRE’s responsibility to send its reasoned proposals to the Ministers for the Economy and for Energy for changes in the regulated sales and transfer tariffs for electricity offered to the LDCs.

The CRE has decision-making power to establish Tariffs for Using the Public Electricity transmission and distribution Networks (Tarifs d’Utilisation des Réseaux Publics de transport et de distribution d’Électricité, TURPE).

Under its residual regulatory power, the CRE also takes network connection decisions, as well as decisions to define the rules for calculating and adjusting the rights of suppliers to the ARENH.

The CRE is also vested with very broad powers that enable it to obtain any information that it may deem useful for the fulfilment of its remit, as well as authority to settle disputes and to apply penalties, through the Settlement of Disputes and Sanctions Committee (CoRDiS).

The Law on Energy Transition for Green Growth also gives the CRE the possibility of having the information it obtains through its remits audited, at the expense of the audited undertakings.

Organic Law no. 2017-54 of 20 January 2017 on Independent Administrative Authorities and Independent Public Authorities and Law no. 2017-55 of 20 January 2017 on the General Statute of Independent Administrative Authorities and Independent Public Authorities, provided these authorities, including the CRE, with a common legal status and lay down the rules relating to the mandate and ethics of members, the operation and organisation of these authorities and parliamentary control.

(1) According to the CRE’s retail market observatory report on the third quarter of 2021: providers who say they have offers available in at least 90% of all municipalities in metropolitan France connected to the grid (excluding Corsica). At 30 September 2021, just over 100 non-national electricity providers were active within this area.

(2) Decret no 2022-342 of 11 March 2022.