During 2022, the CRE notified EDF that ARENH deliveries to three alternative suppliers had ceased due to their court-ordered liquidation or suspension of their governmental licence to purchase electricity. 21.9MW of volumes in the May 2022 ARENH session were not delivered by EDF due to (i) defaulting suppliers being placed in liquidation and (ii) non-implementation of the procedure to transfer their ARENH entitlements to the suppliers of last resort, and the CRE reallocated all these volumes to the November session.
ARENH applications during the November 2022 session for delivery in 2023 totalled 148.87TWh (excluding applications from EDF subsidiaries and network operators). The CRE scaled down certain applications (-0.56TWh in total), bringing the total application volumes validated by the CRE to 148.30TWh, and curtailed each supplier’s application, within a total limit of 100TWh. Further volumes were also sold by EDF to its subsidiaries through contracts that replicate the ARENH scheme, and to compensate for network electricity losses (26.6TWh).
Regarding the possibility of a transition to new regulations governing EDF’s nuclear power plants, as announced in the draft multi-year energy programme (PPE) published on 25 January 2019, in January 2020 the French government launched a call for contributions regarding the fundamental findings driving the plan to reform the economic regulations for existing nuclear facilities, and its construction and operating principles. The proposed new regulations would replace the ARENH scheme. Like many other actors in the sector, the EDF group participated in this consultation, which ended on 17 March 2020. France’s Minister for the Ecological and Inclusive Transition and Minister of the Economy and Finance then commissioned the CRE to carry out an assessment of the costs borne by the nuclear operator, and to determine fair remuneration for its nuclear activities under the government’s potential future regulations for existing nuclear facilities. There have been no significant developments in the terms and conditions of these potential new regulations since 2021 (see note 10.8).
Sales are comprised of:
| (in millions of euros) | 2022 | 2021 |
|---|---|---|
| Sales of energy and energy-related services | Sales of energy and energy-related services 2022 129,831 |
Sales of energy and energy-related services 2021 77,432 |
| energy (1) | energy (1) 2022 109,281 |
energy (1) 2021 56,866 |
| energy-related services (including delivery (2)) | energy-related services (including delivery (2)) 2022 20,550 |
energy-related services (including delivery (2)) 2021 20,566 |
| Other sales of goods and services | Other sales of goods and services 2022 6,607 |
Other sales of goods and services 2021 5,511 |
| Trading | Trading 2022 7,038 |
Trading 2021 1,518 |
| SALES | SALES 2022 143,476 |
SALES 2021 84,461 |
(1) Sales of energy include €12,229 million of sales related to optimisation operations on the wholesale gas and electricity markets in 2022 (€1,623 million in 2021). These operations are carried out by certain Group entities to balance supply and demand, in compliance with the Group’s risk management policy. In 2022, the principal operating segments with a net short position in euros on the markers are France – Generation and supply (gas), Italy (electricity) and Dalkia (electricity). In 2021, the segments were France – Generation and supply (gas) and Italy (electricity).
(2) Delivery services included in this item concern the distribution network operators Enedis, Électricité de Strasbourg and EDF for non-interconnected zones. However, delivery services concerning EDF Energy and Edison are included in Sales of energy, because those entities are classified as the principal under IFRS 15 for both supply and delivery. The delivery services by EDF Energy and Edison have no impact on net income because they are included in “Transmission and delivery expenses” in note 5.2.
After elimination of foreign exchange effects and changes in the scope of consolidation, the Group’s sales for 2022 were up by 69.4% or €58.6 billion. Most operating segments were concerned by this increase, which reflects the rise in energy prices and generally had neutral or moderate, if not negative, effects on EBITDA. It was particularly marked in the France – Generation and Supply segment (+€15.2 billion), Italy (+€18 billion), Other activities (+€15.5 billion), the United Kingdom (+€6.2 billion), the Other international segment (+€1.9 billion), and Dalkia (+1.3 billion). Sales by the segments with less or little exposure to energy market price effects (EDF Renewables, Framatome) were higher than in 2021.
Sales by the France – Generation and supply segment showed organic growth of +€15.2 billion. This increase is mainly explained by price effects estimated at +€7.2 billion, although they were limited by the government’s tariff cap measures and the passing on to customers of the effects of the additional ARENH allocation. Volume effects (associated with the weather, portfolio effects, and a downturn in consumption, especially in the final quarter of 2022) are estimated at around €(1.2) billion. Sales also benefited from the impact of resales of electricity covered by purchase obligations (+€4,956 million), principally attributable to higher market prices (the effect on operating income before depreciation and amortisation was neutral due to the CSPE compensation mechanism covering expenses related to purchase obligations). Sales by this segment also include +€895 million increase in revenues from additional ARENH sales to alternative suppliers (with a negative effect on operating income before depreciation and amortisation – see notes 5 and 5.1.1). Finally, the segment’s sales growth was also accentuated by the good performance of energy aggregation subsidiaries, which achieved +€2,404 million (with no significant impact on operating income before depreciation and amortisation).
The +€18 billion organic increase in the Italy segment’s sales comprises €13.4 billion contributed by the Gas activities, mainly due to favourable price effects, and secondarily a rise in volumes sold in the Electricity activities, which contributed €4.6 billion, mainly due to price effects.
The +€15.5 billion organic increase in sales by the Other activities segment compared to 2021 essentially concerned the gas activities (+€10 billion), supported by the rise in wholesale gas prices and volumes sold, and EDF Trading’s trading margin (+€5.5 billion) which increased due to the trading performance in Europe and the United States in a high-volatility environment on all commodity markets.
The +€6.2 billion organic increase in the United Kingdom segment’s sales is principally attributable to the impact of rising energy prices and higher nuclear power output, which was up by +1.9TWh as a result of good plant availability and a lighter maintenance programme, despite the shutdowns of Hunterston B in January 2022 and Hinkley Point B in August 2022. Support measures for BtoB and BtoC activities introduced by the UK government from September 2022 are paid directly by the State to final customers, and thus have no impact on the level of sales recognised under IFRS 15.
The +€1.9 billion organic increase in sales by the Other international segment principally reflects the rise in sales in Belgium (€1.8 billion, essentially by Luminus). This development resulted from price effects relating to both electricity and gas.
Sales by Dalkia showed an organic increase of €1.3 billion, mainly driven by the increase in gas prices. Sales also benefited from dynamic business activity in the United Kingdom and France.
