Universal Registration Document 2022

Note 6 Net changes in fair value on energy and commodity derivatives, excluding trading activities

Net changes in fair value on Energy and Commodity derivatives, excluding trading activities, stood at €(849) million at 31 December 2022 after €(215)  million at 31 December 2021, principally reflecting the high price volatility on the commodity (electricity and gas) markets.

Note 7 Other income and expenses

Other income and expenses amount to €(687) million for 2022. They principally comprise:

• exceptional additional costs relating to work for repairs to the main secondary circuit welds at the Flamanville  3 EPR, totalling €(638)  million (these are defined by IAS 16.22 as abnormal costs and cannot be included in the cost of assets in progress);
• the gain on sale of EDF Energy Services LLC (the energy sales activity of EDF Trading North America, see note 3.1) and Dalkia Russia (see the Dalkia press release of 23 May 2022 in note 1.4.3), and the compensation paid to partners amounting to a net €68 million;
• the expense of the Employee Reserved Offer (ERO) during the period, amounting to €(64) million (see note 14.1);
• provisions relating to proceedings before the civil, administrative and criminal courts concerning the sale by Montedison of Ausimont (the Bussi site) in Italy to Solvay in 2002 (see note 17.3.5).

Concerning the ERO, the Board of Directors of EDF decided on 11 May 2022 on the principle of an employee shareholding operation. This operation led to an increase in the Group’s share capital, through issuance of 18,100,741 new EDF shares on 25 July 2022.

The subscription price for these shares was fixed on 28 June 2022. It included a discount of 30% on the reference price based on the volume-weighted average price of EDF shares traded on Euronext Paris for the twenty trading days preceding the day when the price was determined. The expense corresponding to this discount is recognised in “Other changes” via an adjustment to Group reserves.

Other income and expenses amounted to €(1,123) million in 2021. They principally comprise:

• an amount of €505 million received in application of the agreement signed by AREVA and EDF on 29 June 2021 (see note 2) for a settlement payment of €563 million, less certain amounts, principally payments collected for third parties and assets previously included in the balance sheet;
• exceptional additional costs relating to work for repairs to the main secondary circuit welds at the Flamanville 3 EPR, totalling €(573) million at 31 December 2021 (these are defined by IAS  16.22 as abnormal costs and cannot be included in the cost of assets in progress);
• the net loss on the sales of Dalkia Wastenergy and the investment in CENG, amounting to a total €(286) million (see note 3.1);
• costs relating to the early closure of Dungeness B, amounting to €(164) million including impairment of fuel inventories and spare parts, and provisions for penalties due under the capacity mechanism (see notes 2 and 10.8);
• provisions relating to proceedings before the civil, administrative and criminal courts concerning the sale by Montedison of Ausimont (the Bussi site) in Italy to Solvay in 2002 (see note 17.3.5);
• a provision relating to litigation proceedings in process with France’s Competition Authority (ADLC) see (note 17.3.6).

Other income and expenses includes restructuring expenses in certain Group entities, and other items which are operating income and expenses by nature but of non-significant amounts individually.

Note 8 Note 8 Financial result

8.1 Cost of gross financial indebtedness

Details of the components of the cost of gross financial indebtedness are as follows: