Balance sheet
Research expenses are recognised as expenses in the financial period incurred.
Development costs that meet the requirements for capitalisation laid down in Article 211-5 of the French national chart of accounts are included in intangible assets and amortised on a straight-line basis over their foreseeable useful life.
Other intangible assets mainly consist of software and storage capacity reservations.
Royalties paid for SaaS (Software as a Service) are generally charged to expenses as the services are provided. To qualify as intangible assets, expenses on SaaS contracts must confer a right of control to the user in addition to access to the software for a fixed period.
Intangible assets other than research and development expenses are amortised on a straight-line basis over their useful lives regardless of whether they are generated in-house or purchased.
Details of the net values of intangible assets are shown below:
| (in millions of euros) | Cumulative amounts at 31/12/2021 | Increases | Decreases | Cumulative amounts at 31/12/2022 |
|---|---|---|---|---|
| Software | Software Cumulative amounts at 31/12/20212,768 |
Software Increases479 |
Software Decreases60 |
Software Cumulative amounts at 31/12/20223,187 |
| Other | Other Cumulative amounts at 31/12/2021298 |
Other Increases7 |
Other Decreases- |
Other Cumulative amounts at 31/12/2022305 |
| Intangible assets in progress* | Intangible assets in progress* Cumulative amounts at 31/12/20211,370 |
Intangible assets in progress* Increases728 |
Intangible assets in progress* Decreases494 |
Intangible assets in progress* Cumulative amounts at 31/12/20221,604 |
| Gross values | Gross valuesCumulative amounts at 31/12/20214,436 | Gross valuesIncreases1,214 | Gross valuesDecreases554 | Gross valuesCumulative amounts at 31/12/20225,096 |
| Software | Software Cumulative amounts at 31/12/2021(1,680) |
Software Increases(377) |
Software Decreases(58) |
Software Cumulative amounts at 31/12/2022(1,999) |
| Other | Other Cumulative amounts at 31/12/2021(154) |
Other Increases(14) |
Other Decreases- |
Other Cumulative amounts at 31/12/2022(168) |
| Amortisation and impairment | Amortisation and impairmentCumulative amounts at 31/12/2021(1,834) | Amortisation and impairmentIncreases(391) | Amortisation and impairmentDecreases(58) | Amortisation and impairmentCumulative amounts at 31/12/2022(2,167) |
| NET VALUES | NET VALUESCumulative amounts at 31/12/20212,602 | NET VALUESIncreases823 | NET VALUESDecreases496 | NET VALUESCumulative amounts at 31/12/20222,929 |
* At 31 December 2022, intangible assets in progress notably include studies for the EPR 2 and SMR (Small Modular Reactor) projects, amounting respectively to €980 million and €141 million (€707 million and €69 million in 2021).
The EPR 2 project concerns a new pressurised water nuclear reactor that meets the objectives for third-generation reactor safety, aiming to incorporate design, construction and commissioning experience acquired from EPR reactors and the nuclear reactors currently in operation.
On 16 July 2019, the ASN issued an opinion that the safety levels of EDF’s key design options for its EPR 2 were satisfactory. It stated that “the general safety objectives, the safety baseline requirements and the main design options are on the whole satisfactory”.
The EPR 2 will also offer superior operating performance in terms of power (1650MW compared to 1450MW for the most powerful current reactor), output, availability and manoeuvrability.
The draft PPE published on 25 January 2019 by the Ministry for the Ecological and Inclusive Transition stated that the Government, together with the nuclear industry, would conduct a programme of work by mid-2021 to examine the questions of the cost of new nuclear energy production and its advantages and disadvantages in relation to other low-carbon generation methods, the possible financing models, the project management modalities for new reactor projects and public consultation, and matters relating to the management of waste generated by the potential new nuclear fleet, and that based on this information and depending on developments in the energy situation, the Government would make a decision regarding the suitability of launching a renewal programme for nuclear installations.
While awaiting a decision about the EPR 2, EDF was authorised by its Board of Directors on 16 December 2020 to continue the project until the end of 2022, with a cost budget of around €1 billion.
In 2021, EDF, working with the French authorities, finalised its contribution to the government-supervised work programme: formal provision of feedback from construction of the first EPRs, and demonstration of the French nuclear sector’s ability to handle an industrial programme to build 3 pairs of reactors (using an adjusted EPR model incorporating experience from the earliest EPR projects in France and internationally).
The analysis conducted covered justification of the need, an action plan to mobilise actors in the nuclear sector, estimation of anticipated costs, analysis of the possible options for the programme’s leadership and funding (and their consequences as regards regulation and changes in the legal framework), pre-identification of certain potential sites, consideration of questions relating to management of the waste produced by a new nuclear fleet and action to be taken, including interaction with the European Commission and public consultation.
In the summer of 2021, the DGEC audited the parts of this analysis relating to the programme and validated the methods used to estimate the schedule and costs.
The French President declared in a speech in November 2021 that France would restart a nuclear programme and build new reactors on French soil. On 10 February 2022 during a visit to Belfort in eastern France, he announced the launch of a programme to construct 6 EPR 2 reactors by 2035, and begin studies for an additional 8 EPR 2 reactors by 2050. He also observed that it was necessary to aim to have the first new reactor commissioned by 2035, and said that these new EPR 2 units will be built and operated by EDF.
No investment decision yet has been made. An appropriate funding and regulation plan for this programme is currently in preparation, and an updated completion cost for the project is expected in the summer of 2023.
Until a decision is made on the EPR 2, EDF was authorised by its Board of Directors on 31 March 2022 to continue development work until the end of 2023, and given a budget extension of approximately €0.6 billion.
