The U.K. government has announced that the £18 billion nuclear new build project Hinkley Point C can go ahead under the previously agreed terms with Electricité de France (EDF). We believe that execution risks linked to this project are high and that the related heavy investments will weigh on EDF's already weak free operating cash flow. We are therefore lowering our ratings on EDF to 'A-/A-2' from 'A/A-1'. The stable outlook reflects our view that the remedy plan set by EDF and the French government will reduce the group's adjusted debt over the next two years, while supporting a stabilization of credit metrics. On Sept. 21, 2016, S&P Global Ratings lowered its long- and short-term corporate credit ratings on French
