FOCUS ON EDF EN Analyst Group Lunch Meeting - 6 July 2017 Antoine Cahuzac - Group Senior Executive VP of Renewable Energies and CEO of EDF Énergies Nouvelles Bruno Fyot COO of EDF EN Denis Rouhier CFO of EDF EN
EDF S LEADERSHIP IN RENEWABLES ACTIVITIES IS A STRONG PLATFORM FOR GROWTH Global presence in 22 countries 27.0 0.6 BALANCED CAPACITY MIX WITH 30.4 IN OPERATION 7.8 renewables and 22.6 hydro operating assets 1.3 under construction 3.6 0.05 0.4 31.7 HYDROPOWER: DNA OF EDF Leader in Europe with a growing development pipeline Capacity by Technology Solar 0.8 Other 0.6 SELECTIVE GROUP INVESTMENT PLAN Over 2bn gross investments p.a. and increasing over time Wind 7.4 31.7 Hydro 22.9 Key figures at 31 December 2016. All capacity figures are net figures, corresponding to EDF Group s stake in each asset. Includes net installed power generation capacity and net power generation capacity under construction. In addition, renewables activities comprise 2.9th of renewable heat capacity (located mainly in France and operated by Dalkia) 2
EDF ENERGIES NOUVELLES, A LEADING RENEWABLES PLAYER WITH STRONG TRACK RECORD EDF Group s platform for the development of new renewables Strengthened positioning in offshore wind Entry into Morocco, and South Africa Entry into Brazil and Chile First merchant solar PV project Entry into China Strong development in distributed solar PV (US: grosolar acquisition, France: Mon Soleil & Moi offering launched) 2011 2012 2013 2014 2015 2016 EDF Group takes 100% of EDF EN Entry into Mexico and Israel Strong development of Operation & Maintenance activities Entry into India EDF EN commissioned its first PV + storage project (Toucan, French Guyana) EDF Energies Nouvelles scope includes all non-hydro renewables activities of the Group, except some assets in Italy (Edison), Belgium (EDF Luminus) and in the UK (50% held by EDF Energy) 3
EDF EN: A SUSTAINABLE BUSINESS MODEL, LEVERAGING KEY COMPETITIVE ADVANTAGES KEY COMPETITIVE ADVANTAGES Extensive and diversified international footprint EDF brand name, with dynamic and flexible structure leveraging on local Group synergies Integrated O&M skills and capabilities: operational excellence Development Construction Generation Asset rotation Operations & Maintenance SUPPORTING A MODEL GEARED TOWARDS SUSTAINABLE GROWTH Partnerships bringing strong development opportunities and local market knowledge, with reduced balance sheet impact An intensified development phase starting 2017, with gradually growing CAPEX and a robust pipeline A generator aiming to gradually grow installed capacity and output A strong ability to maximise value from selective asset rotation to cover corporate and development costs An integrated player, active across the entire value chain, with the ability to develop highly competitive projects with high returns 4
EDF EN A DEDICATED PLATFORM TO BENEFIT FROM RENEWABLES CAPACITY GROWTH Net installed capacity x 2.3 since 2010 Significant increase in total output ~85% of long-term contracted generation revenues (2) x2.3 x1.9 Merchant 15% Long-term contracted 85% 6.3 11.3TWh 2.7 6.1TWh 2010 2016 2010 2016 ~14 average remaining years of contract (3) INTEGRATED OPERATOR ALONG THE VALUE CHAIN Development, Construction and Operation O&M (13.5 under management) DSSA (1) >20 years 10% 1-5 years 1% 6-10 years 18% LEADING POSITION IN WIND 11.5 developed and built over the last 15 years 16-20 years 36% 11-15 years 35% (1) Development and sale of structured assets (DSSA) (2) Based on estimations at 31 December 2016 of revenues from fully consolidated assets. Includes regulated, quasi-regulated and long-term contracted assets (3) Based on estimations at 31 December 2016 of revenues from fully consolidated assets. Revenues from assets with a strict regulated or commercial PPA 5
HIGH VALUE CREATION REQUIREMENTS AND TRACK RECORD FOR EDF EN PROJECTS A SELECTIVE DEVELOPMENT POLICY TO DELIVER ATTRACTIVE IRR SPREADS (1) ABOVE WACC Rigorous country analysis Stringent initial project selection Advanced engineering capabilities to estimate projects returns Unique procurement process with in-depth due diligence of supply chain Strict investment decision processes ONSHORE WIND SOLAR PV 200 to 300 bps (1) Average performance based on a review of all projects over 50m CAPEX until mid-2016 Source: Company 6
WITH OVER 2.8 SOLD SINCE 2013, DSSA (1) IS AT THE CORE OF EDF EN S BUSINESS MODEL EDF EN has an excellent DSSA track record DSSA is a self-funding and Value accretive business model CONSISTENT ROTATION OF OPERATIONAL ASSETS (EDF EN NET CAPACITY SOLD) 0.5 DSSA EBITDA / Generation EBITDA ratio in 2013-16 = c. 45% 0.7 0.6 1.0 DSSA ACTIVITIES ARE AN IMPORTANT PART OF EDF EN S BUSINESS MODEL DSSA consists of the disposal of certain fully-structured projects (typically in operation and financed) Allows the execution of additional market opportunities with superior returns 2013 2014 2015 2016 CUMULATIVE ASSET ROTATION 2013 TO DATE RoW 3% 2.8 North America 74% Europe 23% KEY BENEFITS OF DSSA Immediate value crystallization : Realize premium on capex Balance portfolio through asset rotation Increase financial flexibility through management of net investments Increased competitiveness due to lower financing costs due to participation of a co-investor (1) Development and sale of structured assets (DSSA) 7
WITH 13.5 UNDER MANAGEMENT, O&M EXPERTISE CREATES VALUE FOR THE WHOLE CHAIN 4 KEY PRINCIPLES Competition with turbine manufacturers, particularly on contract renewals Obsolescence of turbines and risk of bankruptcy Alternative to turbine manufacturer monopoly Increase of technical expertise in the group Strong credibility regarding the turbine manufacturers and third party investors Rationalizing of projects by optimizing conception and construction 1 2 M&A and DVAS: improved evaluation of acquisitions and an advantage for asset divestitures Better price positioning on tenders / auctions and increase of the IRR by operational services Value creation on other positions 4 3 Improve asset performance Transparency and a shared goal of improvement of the production Continuous innovation and predictive maintenance programs 8
EDF EN IS BUILDING A GROWING EXPERTISE IN STORAGE, BOTH IN CENTRALIZED AND IN DISTRIBUTED PROJECTS 1 UTILITY - SCALE 2 Commercial & industrial BEHIND-THE-METER 3 Residential EDF EN projects Short term balancing Mc Henry 20MW / 8MWh (frequency regulation) West Burton B 49MW (frequency regulation) Renewable integration Toucan I 3MW (load shifting) Self-consumption Awarded for 7 projects 2 MW (PV + storage) Self-consumption (PV + storage) (PV + storage) Developer & Investor Current organization Engineering, Energy Management System (EMS) Project development, EPC, commercialization Geographic focus Notes: 1. Other projects commissioned at EDF group level include: Pegase (1MW, load shifting), NiceGrid (1MW, load shifting), Les Renardières (1 MW, frequency regulation), VENTEEA (2MW, multiple applications) Source: EDF EN 9
FOCUS ON FRENCH OFFSHORE WIND SUCCESSFUL VALUE CREATION THROUGH A STRATEGIC PARTNERSHIP IN THE 3 FIRST FRENCH OFFSHORE WIND PROJECTS Eolien Maritime France portfolio 3 offshore wind projects in France Over 1.4 of combined capacity Highly valuable partnership with Enbridge Total investment costs of c. 6bn Efficiency increases with economies of scale Optimised financial structure Partnering up to share funding, development and construction risks Equity method Wind farms Alstom production facility Project / contractor facility A Maintenance centre B Logistical hubs Brest Saint-Nazaire (480MW) Rennes A Cherbourg B B Courseulles-sur-Mer (450MW) Nantes Fécamp (498MW) Le Havre Paris 70% Fécamp 30% Innovation Floating offshore 50% 50% 85% 100% Courseulles- Sur-Mer Saint-Nazaire 15% Innovative pilot awarded in France in Nov 2016 Floating foundations allow for higher load factors as they can be placed in particularly windy areas previously untapped Contract awarded to EDF EN for the installation of three 8-MW turbines on floating foundations in the Faraman area (off Fos-sur-mer) 10
SIGNIFICANT INVESTMENT PLAN IN NEW RENEWABLES, SUPPORTED BY A SOLID PIPELINE LARGE AND VISIBLE PIPELINE RECENT HIGHLIGHTS CURRENT EDF EN PIPELINE (1) BY TECHNO- LOGY Offshore Wind 9% Onshore Wind 62% 16.8 Solar 29% Commissioning of first wind projects in China after UPC acquisition Collaboration with Masdar in the largest PV plant in MENA (DEWA 3-800 MW) BY AREA RoW 15% Latin America 7% Asia 9% 16.8 North America 34.5% Europe 34.5% Focus on emerging countries offering grid parity Acceleration of Brazil platform development: ~500 MW under construction (PV + wind) Ongoing takeover bid of Futuren (France, Germany, Morocco, Italy) (1) Pipeline (gross capacity) at 31 December 2016 excluding capacity under construction (2) Development and sale of structured assets (DSSA) 11
FUTUREN : A LEADING RENEWABLE ENERGY PLATFORM 389 MW gross capacity in operation and a 168 MW pipeline of onshore wind in 4 countries ASSET PORTFOLIO STRATEGIC RATIONALE 333MW nets capacity 389MW gross capacity 168 MW of projects Morocco France 118 118 159 Germany 140 357 Italy 25 40 Additional growth in asset base and development pipeline in France Growth opportunities in onshore wind repowering and third party management businesses in Germany 357 MW managed for 3 rd parties 50 50 Stronger positions in Italy and Morocco KEY FIGURES WITH WIND ASSETS IN FRANCE, GERMANY, ITALY AND MOROCCO FUTUREN CONTRIBUTES PERFECTLY TO EDF EN S GEOGRAPHICAL AND TECHNOLOGICAL RAOADMAP 12
A TRANSACTION FULLY IN LINE WITH EDF GROUP CAP 2030 STRATEGY LOW-CARBON GENERATION Largest low-carbon generation fleet Attractive and balanced generation mix Intensified renewable energy growth RENEWABLES Renewables NETWORKS PROXIMITY TO CUSTOMERS AND LOCAL COMMUNITIES Decentralization Digitization Services Increased share of regulated / long-term contracted generation NUCLEAR Innovation Transformation Nuclear & International CUSTOMERS Customers Being an efficient, responsible company leading low-carbon growth to address the global energy transition challenges 13