The electricity giant’s turnover increased by 70% to 143.5 billion euros driven by rising energy prices, but the group went into the red with a very heavy net loss of 17 .9 billion, compared to a profit of 5.1 billion in 2021.
This is one of the heaviest losses in recent history in France, behind France Telecom (20.7 billion) and Vivendi Universal (23.3 billion) twenty years ago.
With the general surge in electricity prices, EDF saw many French customers return, but could not produce enough with its power plants: the group had to buy electricity at high prices on the markets.
“Despite a strong increase in turnover supported by electricity and gas prices, EBITDA (gross operating margin) is strongly penalized by the drop in nuclear production as well as the exceptional regulatory measures put in place. in France for 2022, in difficult market conditions”commented on Friday for a few journalists the CEO Luc Rémont, arrived last fall with heavy challenges for the company.
The leader, however, confirmed “the nuclear production range of 300 to 330 terawatt hours (in 2023), i.e. a gradual exit from the stress corrosion crisis”, that is to say the problem of micro-cracks noted on portions of piping, which has shut down a number of reactors since the end of 2021.
The year 2022 will have seen nuclear and hydraulic electricity production fall to historically low levels in the midst of the global energy and climate crisis.
EDF has indeed accumulated the troubles between the discovery of corrosion and the delays in the maintenance of the power plants because of the Covid. Result: in 2022, the average availability of the fleet of 56 reactors fell to 54% (compared to 73% over the period 2015-2019), raising the threat of power cuts in the middle of winter.
Corrosion, drought, war in Ukraine
In the end, the worst was averted thanks to electricity imports, French sobriety efforts and EDF’s race to reconnect its reactors.
Nevertheless, the note is salty for the electrician. Never have so few terawatt hours of nuclear origin been produced since 1988: 279 TWh in 2022. Far from the time when EDF was spitting out 430 TWh as in 2005.
The war in Ukraine hit the nail on the head with soaring gas and electricity prices.
Because to contain the bill of the French thanks to the tariff shield, the State, majority shareholder and soon sole, forced the group to sell in 2022 more electricity at low prices to its competitors, alternative electricity suppliers. A measure at an exorbitant cost for the incumbent operator: 8.34 billion euros.
Nuclear revival
Regularly denounced by EDF and the unions, this mechanism called Arenh was built by France in 2010 to try to stay in the nails of the competition imposed by Brussels. How? By forcing EDF to sell part of its nuclear production (100 TWh) to its competitors at the cost price of 42 euros per MWh.
Luc Rémont, charged by the executive with presenting a rescue recipe by the spring, affirmed in October that this system was “breathless”.
Face to his said abyss, “we won’t be alone”argues EDF, however, since the State is in the process of renationalizing the company 100% to carry the nuclear recovery plan supported by Emmanuel Macron.
“The state will allow us to finance investments and meet the group’s financing needs”said Xavier Girre on Friday, EDF’s financial director, who also has a 2023 target “an Ebitda significantly higher than that of 2021”.
The new boss, he must submit his roadmap to straighten the group to the Prime Minister before the summer.