EDF Energies Nouvelles Annual Report 2010

may 2011 Corporate Communications Department

A speciAlist in renewAble

e n e r g i e s

eDF energies nouvelles is celebrating

10 yeArs of green and sustainable growth

10 years as an integrated

diversified and international energy company 10 yeArs oF strAtegic Developments

and challenges to which we have

devoted all our energy EDF Energies Nouvelles Cœur Défense – Tour B 100, Esplanade du Général de Gaulle 92932 Paris La Défense Cedex Tel: +33 (0)1 40 90 23 00 Fax: +33 (0)1 40 90 23 66 Limited company with capital of e124,109,465.60 RCS Nanterre B 379 677 636

www.edf-energies-nouvelles.com

EDF EN, a world leader in the green electricity generation

455

1,573 M

E

E

CONSOLIDATED REVENUES

EBITDA

106

E

M

M

NET INcomE - group shArE

4,512 mW 3,335 mW

gross INsTAllED cApAcITy

NET INsTAllED cApAcITy

IN sErVIcE or uNDEr coNsTrucTIoN

6 TWh

grEEN ENErgy gENErATED IN 2010

3,000 2010 consolidated figures

EmployEEs WorlDWIDE

1

We believe in RENEWAbLE ENERgIES and their ability to become COMpETITIVE in the future.

For the past 10 years, we have been enjoying rapid and profitable growth.

2

This performance has been predicated on our original strategic choices, which have paid off steadily.

Firstly, we opted to focus on all renewable energies, with a special emphasis on wind energy, and to join forces with an industry-leading energy group a decade ago. Secondly, we decided to embark on a diversified international expansion drive from the very outset, with an early move into the North American market. Thirdly, we chose to pursue profitable growth through a selective approach.

For many years now, our firmly held beliefs have been guiding us on our way. We believe in renewable energies, their ability to become competitive and their tremendous growth potential.

Their share of the power generation market is bound to increase because they help to meet several energy challenges, such as the availability of reserves, safety, environmental protection and, ultimately, pricing.

Renewable energies have been spurred on by the fact that demand for energy is set to double by 2050, while the supply of conventional energy is nearing its limits. They are supported by the fact that it is vital for governments to consider their energy independence and curb environmental impacts. Lastly, with energy prices forecast to increase and renewable energies maturing more rapidly, they are likely to achieve grid parity, albeit at different rates. Wind energy is already close to this point. With the other technologies, cost reductions and innovation have raised the prospect that they will become competitive in the near future.

While renewables do not represent the only possible solution, they have established themselves as energies of the future. The wind and solar energy industries have created new growth prospects on a global scale and vast export markets.

The leading energy groups and oil majors have very clearly grasped this point. The renewables market is in the process of gaining a whole new dimension, with major players holding sway.

This explains why we joined forces with the EDF group and are now forging even closer ties as we embark on a new phase in our industrial development.

p창ris Mouratoglou Chairman of the Board of Directors

3

COmbininG strenGth AnD fLexibiLitY tO OverCOme ChALLenGes

4 EXECUTIVE COMMITTEE David Corchia Chief Executive Officer Yvon AndrĂŠ Chief Operating Officer (France) Philippe Crouzat Chief Financial Officer Christophe Geffray Chief Operating Officer (Industry) Laurence Juin Deputy Chief Executive Officer (Southern Europe) Olivier Paquier Chief Operating Officer (Distributed Energies)

“bringing EDF EN and EDF together is a way of achieving the best of both worlds�

Message from David Corchia, Chief Executive Officer For the past decade, EDF Energies Nouvelles has been affiliated with EDF and thus enjoyed the backing of a powerful group. Over this period, our exceptional pace of growth has been driven by the momentum of the Group and its market. However, our performance has been built on a business combination that brought together the best of both worlds.

The strength of a major group and the dynamism of a SME* In our expansion into new markets and segments, we capitalised to the full on our momentum as an initially independent company set up by an entrepreneur. The Group, which has stayed flexible and nimble so that it can adapt to markets in various different countries, achieved very rapid expansion in international markets. It grew to become a leading player by working with partners and building teams that are now the envy of the global industry.

Given the substantial capital requirements, its membership of a major energy group represented a major boost. The Group provided its credibility, expertise, R&D capabilities and financial strength, giving its subsidiary the means to take off. And it provided financial backing for all the major stages in its development in wind, then solar energy, through a series of capital increases.

Continued emphasis on entrepreneurial vision to rise to new challenges A new era is beginning for renewable energies. The capital and industrial challenges are increasingly too big for medium-sized companies to overcome. The EDF group wants to provide more direct support to its subsidiary as it pursues an ambitious industrial plan. Together, we will make sure that we keep its entrepreneurial approach intact, as this emphasis on profitable organic growth has formed the bedrock of our value and our success. We provide a stimulating environment for our teams and our talented, committed and fully devoted partners.

*Small and Medium Enterprise

5

The board of Directors’ view of the alliance between a major group and a SME*

6

jEAN-LOUIS MAThIAS EDF Group Executive Director in charge of coordinating activities in France, as well as the IT, gas and renewable energies activities

EDEV SA

STéphANE TORTAjADA

Represented by Olivier Petros.

Renewable energies Director EDF Group

Director of Financing and Investments of the EDF group

“With its initial foray into the hydro segment, EDF already had a thirst for renewable energies. In 2000, we were one of the first operators to embrace new energy sources. Now the time has come to lay the foundations so that the renewable energies of the future can achieve success in production.”

“EDF EN represents a combination of the skills and strengths of a fast-growing SME with those of a major energy group. We intend to strengthen this win-win partnership even further through the increase in EDF’s ownership of the Company’s capital.”

4 Directors appointed on the recommendation of the EDF group

“EDF EN has a genuinely entrepreneurial culture.

Combined with the EDF group’s industrial experience and financial clout, it will be able to play an active, pragmatic and innovative role in helping new forms of energy to take off.”

YVES gIRAUD Generation Economics & Strategy Director - EDF’s Generation Division.

“The renewable energies developed by EDF EN, which do not emit CO2 and have bright expansion prospects, are naturally part of our generation strategy.

Their place in our energy mix is assured.”

3 Directors appointed on the recommendation of the Mouratoglou group.

2 independant Directors

pâRIS MOURATOgLOU

ELIE COhEN

pIERRE RIChARD

Chairman of the Board of Directors

Research Director at the CNRS Professor at Sciences Po Member of the Prime Minister’s Economic Analysis Board Appointed on the recommendation of the EDF group.

Former Chairman of the Board of Directors of Dexia SA Expert appraiser with the Board of Directors of the European Investment Bank Appointed on the recommendation of the Mouratoglou group.

“EDF EN has established itself as the nationwide leader and a key player worldwide since its IPO. Renewable energies are on the road to becoming cost-competitive, and there is no going back. Their development on a massive scale will contribute to global expansion.”

“EDF EN is a fine example of a dynamic enterprise that has successfully pursued a profitable growth strategy in a fast-moving industry in which operators need to be nimble, responsive and at the same time financially very robust.”

“The relationship we built with a major group ten years ago made our expansion in renewable energies possible. Without this crucial support, we could not have invested so heavily.”

jEAN ThOMAzEAU Former Advisor to the CEO of BNP Paribas

SIIF Société Internationale d’Investissements Financiers represented by Catherine Mouratoglou

“I have seen the company grow from a familyowned business to a SME operating on an international scale. Its development has been very impressive.” *Small and Medium Enterprise

“This combination between a large group and a SME has created a melting pot of viewpoints and cultures. It has enriched both of them.

It has also made for active governance and a stimulating working environment.”

ShAREhOLDINg STRUCTURE at April 7th, 2011 Mouratoglou Group EDF Group Public

On 8 April 2011, EDF announced that it is launching a public cash or stock offer for the 50% of EDF Energies Nouvelles’ capital that the Group does not already own. The indicative timetable states that the offer will open by 26 May 2011 at the latest and close on 15 June 2011. The Mouratoglou group has undertaken to tender all of its shares to the offer-half to the cash offer and half to the stock offer.

24.9%

50%

25.1%

7

8

IN ThE pAST few believed that

environmentally friendly

E N E R g I E S could form the basis

for a profitable bUSINESS MODEL

WE bELIEVED IN ThEM 10 years before everyone else

9

CAPitALisinG On DiversitY meAns PLAYinG the riGht CArDs At the riGht time EDF Energies

10

Nouvelles’ goal has always been to leverage SEVERAL business segments and markets poised for strong growth.

Its development in the already mature WIND segment and the SOLAR segment, which is experiencing a fast pace of technological change, demonstrates the pertinence of its decisions. Likewise, the group has opted to integrate ThE

FULL SpECTRUM OF SEgMENTS into its activities as a producer of green electricity.

MARKETS segments with a bright future Renewable energies are establishing themselves on the global energy landscape. Their contribution to electricity generation is set to grow going forward. Expert predictions, notably those made by the International Energy Agency, project further strong growth, even including in the lowest forecasts. EDF Energies Nouvelles has established itself in these energy segments of the future, with wind and solar energy the priority.

11 WIND

Solar

â—† 26% growth p.a.

â—† Global installed capacity up 19-fold in 10 years

38

195

59

24

5 2

2001

2005

2010

Total global installed capacity in GW (source: GWEC).

2001

2005

2010

Total global installed capacity in GW (source: EPIA).

WIND the cornerstone In the space of ten years, EDF Energies Nouvelles has become a major player in the global wind energy industry. This now mature form of electricity generation is the Group’s principal energy segment. It owns and operates more than one hundred wind farms, which it also developed and built. Onshore wind, the core segment, is driving and will drive future growth thanks to the Group’s diversified portfolio of high-quality projects in ten countries.

12

85% 3,841 MW

of capacity

in service or under construction

3,700

wind turbines installed

10 countries Figures at 31 December 2010

“The relatively resilient performance of the sector during the current economic downturn shows that clean energy was not a bubble created by the late stages of the credit boom, but is instead an investment theme that will remain important for the years ahead.

A significant milestone was reached in early 2010: more than 100 countries had enacted some type of policy target and/or promotion policy related to renewable energy, up from 55 countries in early 2005.

Many new targets enacted in the past three years call for shares of energy or electricity from renewables in the 15–25 percent range by 2020.�

Source: REN21 / Renewable 2010 Global Status Report

13

SOLAR the second pillar For EDF Energies Nouvelles, solar photovoltaic represents a new priority, forming its second development driver. The potential for this still fast-moving segment is underpinned by technological innovation and the downtrend in costs. The Group has a presence in both groundbased and roof array projects in six countries.

50% 430 MWp

14

of investments in 2010

in service or under construction

3 million modules installed

6 countries Figures at 31 December 2010

”With effective policies in place, PV on residential and commercial buildings will achieve grid parity – i.e. with electricity grid retail prices – by 2020 in many regions. PV will become competitive at utility-scale in the sunniest regions by 2030 and provide 5% of global electricity.

As PV matures into a mainstream technology, grid integration and management and energy storage become key issues. The PV industry, grid operators and utilities will need to develop new technologies and strategies to integrate large amounts of PV into flexible, efficient and smart grids. By 2050, PV could provide more than 11% of global electricity.”

Nobuo Tanaka, IEA Executive Director (International Energy Agency) Source : IEA - 11 May 2010 - Valencia

15

INTEGRATED BUSINESS LINES all areas of expertise under one roof EDF Energies Nouvelles is active from development through to operations & maintenance for its own facilities, as well as providing customised services to third parties.

16

Development

Construction

Cartographers identify the potential locations for a facility taking into account all the known constraints. Engineers conduct wind and insolation surveys to establish the project’s feasibility and determine the size of the future power plant. The developers coordinate all the construction phases, conduct impact studies and ensure through consultation that the projects fit harmoniously into the landscape. Working alongside local officials, they make the case for the project to the local authorities and oversee applications for the relevant permits.

EDF Energies Nouvelles coordinates its various suppliers and subcontractors, buys equipment, supervises construction work and works closely with its various industrial partners. To maximise the efficiency of its supply chain, the Group makes its purchases from a diversified base of manufacturers and places its equipment orders under multi-year contracts.

Development

Construction

generation

Operations & maintenance

Generation

Operations & maintenance

EDF Energies Nouvelles’ core business consists in developing its portfolio of power plants and managing its assets. Its power plants, which are connected to the local grids, add a green touch to local utilities’ energy mix. Some of the power plants it builds are sold to third-party investors (DSSA* business), which may ask EDF Energies Nouvelles to manage their facilities. In this case, the Group handles the generation and operations & maintenance activities.

Ensuring the quality and sustainability of its generating facilities is a strategic task for EDF Energies Nouvelles. Thanks to its operations & maintenance services, the Group maximises the output from its power plants and their service life. It benefits from the experience gained over 25 years by its US subsidiary, the leading service provider in North America, and more recently set up operations in Europe to handle this aspect of the business in an integrated manner.

Expertise and strengths that EDF EN harnesses for the benefit of its customers by providing a range of operations & maintenance services.

*Development-Sale of Structured Assets

17

exPAnD hOriZOns AnD set mOre AmbitiOUs GOALs

18

The group’s entire strategy is based on setting goals not just in one or two markets, but on expanding in several countries and segments at the same time. A diversified international presence represents a genuine ENgINE OF gROWTh. It serves to smooth different growth rates and reduces risk exposure.

Most significantly, it injects impetus into development by allowing it to tap into a host of new opportunities and opening up NEW

hORIzONS.

North America 1,143 MW in service

Europe 2,279 MW including 501 MW in France

ExPANSION on two continents From the very outset, EDF Energies Nouvelles focused on expanding outside France as market conditions were not very favourable in its domestic market at the time. From a base in several European countries and the United States, the Group gradually broadened its sights to the whole of Europe and North America.

FORAY into new segments To prepare for the future, EDF Energies Nouvelles is establishing a presence in several promising new segments. The Group invests in a diverse range of technologies on a small scale, either alone or through partnerships, in order to track developments or bolster its expertise. The top priority is to gain access to the technologies of the future on preferential terms.

The areas prospected include emerging technologies, such as offshore wind, marine energies, biogas, biomass, biofuels and concentrated solar power. Each segment brings with it numerous technological options. By establishing selective positions, we can detect where and when disruptive technologies will emerge, turning a segment into a source of growth.

PrESEnCE In 13 COuntrIES: EurOPE: France, Portugal, Spain, Italy, Greece, turkey, Bulgaria, united Kingdom, Belgium, Germany. nOrtH AMErICA: united States, Canada, Mexico.

19

20

TODAYeverybody realises that RENEWAbLE ENERgIES

are not merely an

ALTERNATIVE but

absolutely essential

WE gRASpED ThIS

10 years before everyone else

21

COntrOLLinG GrOWth is essentiAL tO mAintAin PrOfitAbiLitY Renewable energies with

22

their great prospects are enjoying strong and rapid growth. given the substantial investments required, operators need to calibrate their plans accurately so that growth remains under control and profitable. EDF Energies Nouvelles’ business model incorporates two imperatives of RISK CONTROL and financial discipline.

FOCUS on organic growth The development stage is key to the quality of projects and facilities. EDF Energies Nouvelles draws heavily on the expertise of its teams for developing the projects internally that are set to form the Group’s asset base and create value in the future. The goal is not solely to become a market leader.

EDF Energies Nouvelles’ growth objectives are set to reflect its high profitability standards and financing capabilities.

DEvELOP turnkey facilities The Group boasts a genuine key asset helping it to pursue its goals in a controlled manner.

Developing and building projects for third parties (DSSA* business) dovetails neatly with the Group’s core business of generating electricity. The Group can draw financing for its expansion from the sale of power plants, which covers most of its development costs.

*Development-Sale of Structured Assets

SELECT opportunities For its international expansion, the Group opts in priority for markets still in their infancy with strong growth potential still intact. EDF Energies Nouvelles also selects countries offering a favourable regulatory framework and a stable political and currency environment. The Group also follows a rigorous investment policy, targeting projects based on strict profitability standards and limited risk profile.

23

REvIEW OF 2010 excellent performance 3 questions to David Corchia, Chief Executive Officer

2010 was another year of growth and profitability. What were the key factors?

24

Our development was led by our two principal segments. In the wind segment, growth in capacity was driven largely by Europe. In the solar segment, we saw real acceleration in the pace at which projects were commissioned in five different countries.

However, the highlight of 2010 was the record level of construction starts on both sides of the Atlantic.

Construction of over 1,000 MW in new capacity was launched in our two priority segments, laying the foundations for very healthy performance in 2011 and 2012. From a financial perspective, we continued to achieve profitable growth, with EBITDA up 36%, again ahead of our guidance, plus an increase in net income.

Won’t the changes in the regulatory environment affect your performance?

The diversification in our positions across several countries and segments has helped and will continue to help us contend with unexpected economic and political developments. By covering the cost of the lion’s share of our development costs, our

DSSA business plays a part in our first-class earnings.

What’s more, we benefit from the EDF group’s financial strength. These represent three genuine strengths providing flexibility and resilience.

How far have you progressed towards your year-end 2012 objectives?

At present, we have 3,335 MW in net capacity in service or under construction. Performance during 2010 confirmed that we are right on track to meet our target of 4,200 MW in net installed capacity by year-end 2012. This objective is now in sight. We are heading down the final stretch and starting to prepare for the post-2012 period, with our excitement and dynamism still intact.

“We make sure that our development is very carefully targeted and plan ahead to be in the right place at the right time with the right projects.”

“Over the long term, I am perfectly confident in the unparalleled potential for renewable energies. They provide solutions to critical global issues, i.e. energy supplies, environmental protection, drive to create growth and jobs.

With each passing day, renewable energies are becoming more and more established, especially since the surge in energy prices has rapidly made them closer to being competitive.�

25

10 YEARS of profitable growth In a world of growing demand for energy, EDF Energies Nouvelles is actively contributing to the development of new generating capacity.

Its profitable growth is helping to create positive momentum for jobs in its sector of activity.

26

STRONG GROWTH in production capacity The capacity of the Group’s power plants in service has risen thirty-fold since 2000. It has commissioned more than one hundred wind farms (2,923 MW gross) and the same number of solar facilities (267 MWp gross) around the world. This increase in its production capacity has translated into earnings growth on a similar scale. The steep rise in our bottom line reflects the profitability of this growth.

Net Installed Capacity in MW

x 32

2,663 233

solar PV

2,430 648

wind turbines and others

84 2001

2005

2010

EbITDA in e

Net income, group share

million

x 32

in e million

455

17

62

0,9

14

2001

2005

x 117

106

2010

2001

2005

2010

27

A CONSTANTLY GROWING source of jobs

Employees

x 35

3,000

410 85

2001

2005

2010

For the past ten years, the Group has enjoyed a consistently brisk pace of expansion. This vigorous growth has made EDF Energies Nouvelles one of the leaders in its sector and fostered the creation of jobs.

The Group’s headcount has gone up from 85 to over 3,000, not to mention the numerous indirect jobs it has created at equipment manufacturers and local subcontractors.

2000 10 YEARS First wind farm commissioned of impressive accomplishments in France. EDF takes a 35% stake in SIIF Energies.

2002 PORTUGAL Cabril & Pinheiro 37.8 MW

28

2004

2002

Acquisition of enXco, a leading player in the uS wind energy market.

EDF increases its participation in SIIF Energies to 50%.

2003 FRANCe Bouin 19.5 MW

2003 US Chanarambie & Viking 97.5 MW

2006

SIIF Energies changes its name to EDF Energies nouvelles.

Stock Exchange Listing on Euronext Paris.

2006 UNiTed kiNGdOM Fenlands 44 MW

2004 US Oasis 60 MW

2006 SPAiN Biomass 26 MW

2005 FRANCe Aumelas 22 MW 2007 US Fenton 205.5 MW

2005 iTALy Andretta 70 MW

2007 GReeCe Perdikovouni & kalyva 36 MW

2009 BeLGiUM Offshore First 30 MW

2008

Increase in EDF Energies nouvelles capital, to finance the development of solar photovoltaic energy.

2008 FRANCe Chemin d’Ablis 52 MW 2008 PORTUGAL Ventominho 240 MW

2008 US Sacramento Sun 1.25 MWp

2009 CANAdA Arnprior 23.4 MWp

2010

2010 iTALy Monte Grighine 98.9 MW

2010 MeXiCO La Ventosa 67.5 MW 2010 SPAiN Casatajada 11.4 MWp

2010 TURkey Soma 79.2 MW

29

30

IN ThE FUTURE

renewable energies

are set to become

COMpETITIVE

through an innovation

DRIVE and COST REDUCTIONS

WE ANTICIpATED ThIS

10 years before everyone else

31

shArinG sUCCess is the best WAY Of mAKinG it sUstAinAbLe

32

The close relationships that EDF Energies Nouvelles, a reliable and well-known operator, has forged with the world’s leading equipment manufacturers, have helped to give a boost to the scale of its projects, cut the associated costs and raise consistently the level of its technical performance.

In the same way, it seeks to pursue bALANCED

AND SUSTAINAbLE pARTNERShIpS in international markets by working together with local operators.

SUSTAINABLE industrial partnerships REPOWER Conquering the Canadian market together

“

EDF Energies Nouvelles’ huge experience of the market and operational conditions gives us an important advantage in delivering performance and reliability, in using the most advanced technology. Our relationship is very open and trusting. We started working together on common projects in France and the U.K, and then in the U.S. The next big step was the joint tendering for a big tender offer in Quebec, which was very successful. This 954 MW project, which is the biggest onshore contract in REpower’s history, was our entry into the Canadian market, and also the best example of our mutual success. EDF Energies Nouvelles provided the development capability, and of course the French relationship to Quebec, and REpower handled the technological part. We had a lot of interfaces and loops between our teams.”

Matthias Schubert, Member of the Executive Board, REpower Systems AG. With its worldwide presence, REpower is one of the leading system providers of wind turbines in the onshore and offshore sector.

vESTAS A natural business relationship

“

For more than 10 years, our two companies have been strengthening each other’s positions and directly supporting the worldwide development of the wind energy industry. Our partnership provides a unique capability for defining common objectives and focusing on long-term planning. Ours is a natural business relationship. As one of the largest global wind technology and service providers, Vestas has an extensive experience in siting, installation and maintenance of wind power plants in all the markets where EDF Energies Nouvelles is present. This has given us the opportunity to continuously share and benefit from best practices. Further, this has also allowed us to enhance our services, thus reducing EDF Energies Nouvelles’ turbine downtime, lost production and installation lead times. And this is just the beginning.

EDF Energies Nouvelles and Vestas have an ambitious plan to further develop their relationship in the area of wind power plants.”

Thomas Kirk Jepsen, COO Vestas Mediterranean.

The Danish company vestas is a global player and market leader in wind energy, operating in more than 70 countries worldwide.

Every three hours vestas installs a new wind turbine.

FIRST SOLAR A virtuous circle of progress

“

The close relationship we’ve built supports our shared vision for the development of key markets for solar energy. It also helps to shape the policy environment in which both companies operate. Our long-term relationship reduces costs for EDF Energies Nouvelles and helps First Solar to scale and reduce costs further. This completes a virtuous circle. The high volumes that we are able to sell to EDF Energies Nouvelles contribute to our ability to invest in R&D and to expand our manufacturing capacity.

This expansion accelerates the realisation of our joint vision of a world powered by clean, affordable solar energy. Together we aspire to create utility-scale solutions to help countries meet their energy security and renewable energy goals.”

Stephan Hansen, Managing Director of First Solar GmbH and Head of Components Business Group in Europe.

First Solar is the largest manufacturer of thin film solar modules in the world, and the first pure player renewable energy company to be listed on the S&P 500.

33

POLAT A winning combination for development

“

34

The partnership in Turkey between Polat Group and EDF Energies Nouvelles has led to a very strong co-operation in technical and financial terms, with builtin advantages for completing large investments in a short time with optimum results. In the past two years, Polat Enerji’s installed capacity has been multiplied by 4. Clearly, our goals are to be a leader in the development of wind power in Turkey, and also to begin solar energy projects.

Together, Polat Group and EDF Energies Nouvelles provide the technical and financial assets as well as the institutional infrastructure required for this challenge. Our relationship is a winning combination, one that gathers the vision of a large international energy operator and the very specific knowledge of a major local player.”

Adnan Polat, Polat.

Active in Turkey for more than 60 years, the Polat group of companies are among the best-known in their fields: industry, construction, tourism, and energy. In 2008, EDF Energies Nouvelles became a 50% shareholder of Polat Enerji.

WAL-MART A good wind to win

“

EDF Energies Nouvelles greatly contributes to WalMart’s strategy of becoming the reference for a sustainable company within Mexico. Our partnership gives us the advantage of a team that has enough expertise in energy projects to achieve our goal of being 100% supplied by renewable energy sources by 2025. Since the beginning both companies had in mind that, we needed to create a win-win relationship whatever the outcome would be. Operational since 2010, the La Ventosa Oaxaca wind farm is the best example of our fruitful collaboration. In Oaxaca, where the wind conditions are particularly good, we have already proved that it’s possible to produce renewable energy at a very competitive cost, without subsidies. And the economic benefits will increase as time passes and as the price of the fossil fuels rises. Based on this successful experience, we now look forward to exploring new and innovative projects with EDF Energies Nouvelles.”

Juan Andrés Ruiz Figueroa, Energy Administration Assistant Director, Wal-Mart Stores, Inc. Mexico.

Wal-Mart is the biggest retail company in the world. Since May 2010, 348 of its self-service stores, price clubs, and restaurants in Mexico are using wind-powered energy from the La ventosa wind farm.

35

enCOUrAGinG innOvAtiOn meAns mAKinG PrOGress POssibLe

36

EDF Energies Nouvelles is helping to create the industries of the future.

Acting as a genuine catalyst, the group detects new technologies, identifies the right partners or supports start-up businesses.

It is prepared to take on the risk of investing in pilot units and in still unproven technologies.

This reflects its

pIONEERINg SpIRIT.

A NETWORK of explorers

NExCIS how to win microns

“ NANOSOLAR From the laboratory to on-the-ground operation

“

As a young, start-up manufacturer, the solidity and reputation of EDF Energies Nouvelles has given Nanosolar the credibility to raise money, to purchase factory equipment for capacity expansion, and to obtain new customers. EDF Energies Nouvelles has continuously supported Nanosolar’s efforts to improve the performance and quality of the Nanosolar Utility Panel. Our goal is for it to ultimately become one of the lowest cost solar panels. In 2011, EDF Energies Nouvelles is building a 3 MW test installation in Gabardan (France) with Nanosolar Utility Panels and another 3 MW installation in Salem, Oregon (USA).

The results of these test installations will enable us to obtain bank financing in 2012 for larger, utility-scale installations. We hope that this important collaborative partnership will permit us to raise the level of production of our panels to an industrial stage in the coming years.

We also expect to enable EDF Energies Nouvelles to build solar PV plants that are truly competitive with fossil fuel-generated power on a Levelized Electricity Cost (LCE) basis within the next several years.“ Geoff Tate, Chief Executive Officer of Nanosolar Located in San Jose, California, Nanosolar is a leading manufacturer of cost-efficient thin film solar cells and panels, based on printing CIGS (CuInGaSe) and nanoparticle inks.

It represents a major bonus to work alongside entrepreneurial partners who encourage you to be audacious and take risks while providing support to ensure that these risks remain under control. Partnering with EDF Energies Nouvelles brings tremendous benefits.

Its industrial vision, its technical capabilities and its knowledge of the market have been crucial. Its ability to push back the frontiers challenges you to go further.

We knew when we launched Nexcis that we needed to target competitive rates by 2013 without counting on subsidies. EDF Energies Nouvelles’ experience has enabled us to develop a product geared to the needs of the French domestic market, and EDF’s R&D network, originally behind this technology, gave us access to its powerful testing resources. At present, our 2-micron thin film electrodeposition process for a CIGS (copper, indium, gallium and selenium) alloy rather than 150 microns for crystalline silicon modules delivers effective conversion performance combined with very low manufacturing costs. We are currently one of very few companies around the world able to do this.“ Olivier Kerrec, Chief Executive Officer of Nexcis Founded in March 2009 and based in southern France’s Energy valley (PACA region) at the former STMicroelectronics facility, Nexcis, a start-up now with 80 employees, plans to commission a 33 MW power plant by year-end 2013.

37

EDF R&D 2,000 R&D staff to find new solutions rapidly

“ DCNS A new wave of energies

“ 38

DCNS was looking to capitalise on the marine expertise it has acquired over four centuries through the recovery of energy from the sea. When we found out that EDF Energies Nouvelles held the right from Carnegie to use a technology suitable for harnessing wave energy, we offered to handle system engineering and oversee implementation of its projects. Our first joint project was a prototype on Reunion Island, which will be implemented at full scale this year. Altogether, the system is 30 metres high. Under the surface, a tank is linked by a connector to a pump fitted on the seabed, which pushes a fluid through to an onshore turbine. This is a pragmatic approach that is both technically and economically efficient. The aim is to demonstrate the reliability of the installation and assess the cost per kWh generated when the wave farm comprising several units is built. The system, the rights to which were acquired by EDF Energies Nouvelles, has the benefit of being adjustable to the power of the waves, potentially making it possible to find an optimum economic balance, particularly on Reunion Island where power generation costs remain higher than in mainland France.”

Frédéric Le Lidec, Director of the DCNS incubator DCNS is a world leader in the naval defense sector and an innovative player in the energy sector, from civil nuclear power to renewable marine energies.

The development of renewable energies requires a very large-scale effort in terms of innovation. The goal is to improve the technical aspects to cut costs and integrate more effectively what are generally intermittent energy sources with electricity grids.

The ties between EDF Energies Nouvelles, an agile and innovative enterprise that has very extensive knowledge of its markets, and EDF’s Research and Development teams, help to accelerate progress and harness new industrial opportunities. Our close cooperation, which dates back to the Company’s early days, is set to increase in certain key areas: thin film solutions to deliver disruptive technologies in solar photovoltaic, offshore wind and the extensive field of marine energies. The next step will be to integrate all these renewable energies in smart grids, which will require new storage solutions. The complementary relationship between research and operations represents a key asset for the Group’s competitiveness in the major European and worldwide markets. The future for renewable energies has never been as bright as it is now!”

Bernard Salha, EDF’s Director of Research and Development With 2,000 R&D staff, EDF R&D covers all of the group’s activities from the production of nuclear, thermal, hydro and renewable energy through to distribution and marketing.

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WE ARE SINCERELY GRATEFUL TO ALL THE PEOPLE WHO PARTICIPATED IN THE INTERvIEWS PUBLISHED IN THIS ACTIvITY REPORT

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DISCLAIMER The figures and information in this activity report are provided for information purposes only and are not contractually binding. This document does not constitute an offer to sell or solicitation to buy securities in the United States or in any other country. This document contains forward-looking statements. EDF Energies Nouvelles believes that they are based on reasonable assumptions, which may prove to be inaccurate and which are in any event subject to risk factors and uncertainties. There is no certainty that the forecast events will occur or that the forecast results will actually be achieved.

These potential risks and uncertainties and the assumptions underpinning these forward-looking statements are presented in EDF Energies Nouvelles’ Registration Document, notably in chapters 4 and 13 (which may be viewed on the AMF’s web site at www.amf-france.org or on EDF Energies Nouvelles’ website at www.edf-energies-nouvelles.com).

PHOTO CREDITS Hervé Hôte - Agence Caméléon (2 nd cover, p.3, p.4, p.15, p.17, p.20, p.22, p.25, p.28-29, p.32, 3 rd cover); Stéphane de Bourgies (p.6-7); Philippe Dollo (p.8, p.10, p.13, p.28, p.32, p.35); Miguel Merino - MStudio (p.10, p.18, p.29); Jans Meier (p.17); Dennis Schwartz (p.18, p.29); Turbomach (p.22, p.28, p.30); Christian König (p.28); Wind Prospect Development (p.28); SMUD (p.29); C-Power (p.29); Nanosolar Inc. (p.36); Jean-Luc Abraini (p.36); EDF - Stroppa Philippe (p.39); DCNS - CETO (p.39); Nicolas Chorier / Lagarrigue / Egis Eau (3rd cover).

DESIGN AND PRODUCTION The Crew paris

may 2011 Corporate Communications Department

A speciAlist in renewAble

e n e r g i e s

eDF energies nouvelles is celebrating

10 yeArs of green and sustainable growth

10 years as an integrated

diversified and international energy company 10 yeArs oF strAtegic Developments

and challenges to which we have

devoted all our energy EDF Energies Nouvelles Cœur Défense – Tour B 100, Esplanade du Général de Gaulle 92932 Paris La Défense Cedex Tel: +33 (0)1 40 90 23 00 Fax: +33 (0)1 40 90 23 66 Limited company with capital of e124,109,465.60 RCS Nanterre B 379 677 636

www.edf-energies-nouvelles.com