The Government published on 12 March 2022 in the Official Journal the Decree and Orders dated 11 March 2022 relating to the additional allocation of 20 TWh of ARENH volumes for 2022.
The Decree provides that eligible suppliers, in order to benefit from the additional ARENH volumes over the period from 1 April to 31 December 2022 at the price of €46.2/MWh, will have to sell EDF the same volume that will be transferred to them by EDF under this additional allocation, at a price equal to the average of the wholesale forward prices recorded between 2and 23 December 2021, for electricity delivery in mainland France in 2022, i.e. €257/MWh. The CRE will distribute the additional ARENH volumes between the suppliers, in the same way as the one that was followed for the delivery period started on 1 January 2022.
This decision sets the purchase price for EDF of the additional ARENH volumes of 20 TWh which will have to be made available to suppliers in 2022. The impact of the regulatory measures announced on 13 January 2022[1],3 on the Group's EBITDA for 2022 was estimated, for illustrative purposes, at approximately -€8.4 billion based on market prices on 31 December 2021. Based on the terms defined in the Decree, and on the information available to the Group at this stage, the estimate of the impact on the Group's EBITDA for 2022 is reassessed at approximately -€10.2 billion[2].
In addition, on 7 February 2022, the Group updated its French nuclear output estimate for 2022 to 295 – 315 TWh. The impact of the decrease in output compared to 2021 on the Group's EBITDA was estimated, at the annual results[3] and for illustrative purposes, at approximately -€11 billion based on the 2022 forward prices on 31 December 2021. Still for illustrative purposes, based on the information available to the Group at this stage and the 2022 forward prices on 11 March 2022, the estimate of the impact of the decrease in output on the Group's EBITDA for 2022 is reassessed at approximately -€16 billion.
EDF maintains its objectives at the end of 2023 of net financial debt / EBITDA of around 3 times and adjusted net debt / adjusted EBITDA[4] of 4.5 to 5 times[5].
The scale and variety of the risks the Group is facing, particularly in an extremely volatile market context, and the analyses and works the Group has to perform on the French nuclear fleet in relation to the stress corrosion phenomenon recently identified, are likely to impact the Group's capability to achieve these objectives. Moreover, in the current situation, the impacts of the Ukrainian conflict and associated geopolitical tensions on all-kind risks are difficult to quantify.
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