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EDF: Energie en Actions Rebels – 08/31/2022 at 15:08

 

(AOF) – The Association for Energie en Actions, which aims to defend the interests of former employees and shareholders of EDF, announced today that it has filed a complaint against X questioning the management of the public group. In July, it stated its intention to file a criminal complaint in a civil suit against the state as the largest shareholder in EDF for exposing the company to difficulties “in defiance of the social interests of the latter company and the interests of its minority shareholders due to reckless decisions and dispossession.”

At the end of August, EDF’s minority shareholders also lobbied for the state’s next takeover offer of €12 per share for the 15.9 percent of the capital it does not yet hold. If this price represents a premium of 53% compared to the closing price of July 5, the day before the Prime Minister announced the re-nationalization project, then some consider it insufficient. Reuters revealed on August 23 that the Minority Shareholders Defense Association (ADAM) sent a letter to EDF CEO, Jean-Bernard Levy.

The union headed by Colette Nouvel urged the leader to go to court to demand compensation of 8.34 billion euros from the state after the government’s decision in January to increase the volumes of nuclear electricity sold at a discount. To the group’s competitors, a measure intended to curb high bills, then the news agency pointed out.

Thus, the share price offered is more than half the price of the initial public offering of EDF shares in 2005, set at €33.

 

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the main points

– The world’s leading low-carbon energy company created in 1946 with 38.5 million customers worldwide and 117.3 gigawatts of installed capacity: 60% in nuclear, 18% in hydraulic, 8% in renewables, 9 % in gas, 3% in fuel oil and 2% in coal

– turnover of 84.5 billion euros and installed capacity of 117.3 gigawatts: 60% in nuclear, 18% in hydraulic, 8% in renewable energies, 9% in gas, 3% in fuel oil and 2% in coal;

– “Cap 30” business model with 3 strategic axes: support customers towards carbon neutrality through 10 billion in revenue in services, number one in the world producing net CO2 electricity and an actor in the energy transition;

– 83.88% of the capital is owned by the state, Jean-Bernard Levy is the CEO of the 18-member Board of Directors;

– The balance sheet was cleaned up in April with a net debt (ranked A due to state guarantee) of €42.3 billion, which will be boosted between 2022 and 2024 by the €3 billion disposal plan.

 

Challenges

– 4 strategic plans: Electric mobility – 30% market share in electric vehicle electrification by 2023 in France, UK, Italy and Belgium – Storage – 10 GW installed worldwide in 2035 – Solar energy – 30% of the market in France year 2035 – and the concession plan for the French nuclear industry;

Dedicated innovation strategy for digital transformation, production processes, future electrical systems and decarbonization of customer uses: R&D budget of €661 million with 756 patented innovations, EDF Pulse Croissance funds, incubators and research partnerships (Sinclair Lab, 5g Living Lab, Quantum computing, etc.);

– Environmental strategy included in the group’s raison d’être: carbon neutrality in 2050 and a 50% reduction, compared to 2017, emissions in 2030, 99% of operating budgets dedicated to decarbonization and energy transition, and €8.755 billion in “green and sustainable” financing 72% of credit lines are indexed by ESG indicators;

– launch of the construction program for 6 EPR2s and studies for 8 more;

– Maintaining the rise in wholesale prices partially equivalent to the state borders to increase prices on individuals from operating profit.

Integrated operator, from design and manufacture of nuclear reactors, through Framatome, 75% owned, along with Mitsubishi (19.5%) through distribution.

 

Challenges

– activity framed by the law of NOME (free competition among all market players and the resale of a quarter of EDF’s nuclear electricity production to its competitors) and the prices of electricity managed in France, so the maintenance cost network is slightly included in the tariffs;

Solving the corrosion problems affecting the reactors, which led to the shutdown of nearly half of the production capacity.

– Impact of the conflict between Russia and Ukraine: raw material volatility and supply tensions;

– neutralizing the competitive advantage of nuclear energy by committing to selling electricity to industrialists at market price and closing or maintaining nuclear power plants, penalizing production in 2022;

– Speculation that the country will be removed from the list;

2023 target with debt leverage less than 3.

 

A threat to the European energy system

The main importer of German gas, Uniper accounts for 54% of the volumes it buys from Russia. After the war in Ukraine, the group had to get the quantities that it lacked on the spot market, the prices of which exploded. With difficulty, he asked for help from the German state, which raises the concerns of all European energy companies. However, Germany’s RWE and France’s Engie both reacted by saying their situation was completely different. RWE stressed that it was less dependent on Russian gas. As for Engie, it benefits from diversifying its supply sources, with increased volumes of LNG delivered in France and contracts with Norway and Algeria. The group has also adapted its hedging strategy to enhance its resilience.

 

 

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