We think the rapidly changing regulatory and competitive landscape for Electricité de France's (EDF's) domestic activities is taking a toll on the group's strong market positions and defensive profile. This comes at a time of high investment needs, and we think the group's stretched credit metrics and negative discretionary cash flows weigh on its credit quality. We continue to think there is a high likelihood that the French government would provide timely and sufficient extraordinary support to EDF in the event of financial distress. We are therefore revising our outlook on EDF to negative from stable and affirming our 'A+/A-1' ratings. The negative outlook reflects the potential unfavorable developments that could stress EDF further, including declining power prices, a possible
