EDF should utilize hybrid bonds at the very high end of S&P’s equity-credit cap.

Key reasons:

- **Balance sheet pressure increased sharply in 2022.** Equity fell from **€62.0bn to €46.6bn**, while total liabilities rose, and the company reported a **€18.2bn net loss**. That materially weakens credit metrics and increases the need for instruments that support capitalization.
- **Cash flow was deeply negative.** Operating cash flow was **-€7.4bn**, investing cash flow was **-€25.1bn**, and financing needs were covered mainly through borrowings, with **€34.2bn of new borrowings**. Hybrids can help fund this gap while receiving partial equity treatment.
- **Debt-like funding needs are structurally high.** EDF has very large capex, nuclear liabilities, concession obligations, and working-capital volatility. Hybrid bonds are suitable for long-duration regulated/infrastructure-heavy issuers.
- **Market rates rose sharply in 2022**, making all funding more expensive, but EDF’s weakened equity base makes preserving rating metrics particularly important. The benefit of equity credit likely outweighs the higher hybrid coupon cost.
- **Existing hybrid usage appears below the full S&P cap.** Equity includes perpetual subordinated instruments, but given total adjusted capital is very large, there is room to use more hybrids before reaching the 15% equity-credit ceiling.
- **A full 100% of the cap may be aggressive** because EDF already has substantial leverage, negative earnings, and state ownership/support considerations; however, underutilizing hybrids would miss a valuable rating-management tool.

Therefore, EDF should make extensive use of hybrids, but not necessarily maximize the cap entirely unless funding stress worsens further.

<answer>75%</answer>