Energy policy: Some small steps forward
The appointment of Péter Kaderják to the position of Secretary of State for Energy and Climate Policy was certainly encouraging news. He is regarded as a progressive energy expert who, as environmentalists hoped, would advance investments into sustainable energy generation facilities and boost eco-friendly energy policies.
To put this into context, Hungary’s modest renewable energy goal under the EU’s stewardship is to produce 14.7 % of its energy by 2020 from renewable sources, a target that has practically been achieved already. It must be noted, however, that this slice of the energy mix is overwhelmingly produced from biomass, the composition of which can be quite problematic. In some cases, it may contain wood harvested from protected forests, and in others even municipal waste, which passes for biomass only after some tinkering with the stats.
As for future trends, last year the Ministry for Innovation and Technology began drafting the country’s new National Energy and Climate Plan (NECP) that will aim at 20 % renewable energy by 2030. Even this is a far cry from the EU’s objective (32 %) within the same timeframe.
Against this background, Kaderják has certainly given momentum to sustainable energy production, especially when it comes to solar power. As of June 2018, solar capacity amounted to approximately 480 MW. This is now expected to quadruple by the end of 2020 due to upcoming tenders already in progress. In fact, he is dreaming even bigger. Speaking at a conference in November he predicted 3000 MW solar capacity in the foreseeable future. Solar capacity building is quite lopsided, though. While big solar parks (up to 50 MW) are being promoted, growth in the prosumer market does not reflect that sector’s inherent potential because proper government incentives are missing there.
Much less positive is the government’s handling of wind power. Here it continues to not make up for the 410 MW-strong public tender that it cancelled back in 2011. Hungary’s present wind energy production is thus merely 330 MW, and it looks like no regulatory approval will be issued for new wind parks until 2030, by which time the presently functioning ones will have aged and ceased to operate.
Another positive development concerns the eventual phasing out of coal-fired energy production. High-ranking government officials have recently started talking about the possibility that Hungary won’t burn any coal after 2030. Some of these statements were mistaken for official government policy, but that is not yet the case.. Regardless, it seems plausible that 2030 could mark the end of coal in Hungary. It is important to note here that Hungary’s only functioning coal plant is the lignite-fired Mátra Power Plant, which produces one-fifth of Hungary’s electricity and some 15 % of the country’s CO2 emissions. The plant has recently been purchased by Prime Minister Orbán’s favourite oligarch, Lőrinc Mészáros. Not surprisingly, the company’s new business strategy is quite in line with the ministry officials’ predictions, inasmuch as it does not foresee any coal-based production after 2030 and proposes a gradual switch to natural gas and renewables until then. In summary, the approaching end to coal-fired electricity generation has more to do with the plant’s aging and with economic trends than the government’s commitment to the sustainability transition.
Any article on Hungarian energy policy must include a brief status update on the controversial Paks nuclear plant extension, financed and built by Rosatom of Russia. Critics of the deal, struck back in 2014, have raised serious concerns about costs, illegal state aid, lack of fair competition including transparency - and last but not least, for making Hungary increasingly dependent on Russia, both politically and economically.
So far though, the project has suffered from repeated delays and, despite several announcements to the contrary last year, practically no work has begun on the construction site. As a consequence, the Russian party has become increasingly frustrated and has urged for the groundwork to begin. Apparently this could be the main reason for the sudden firing of the state secretary in charge, Attila Aszódi, which came out of the blue just this January.
What causes concern now is that János Süli, the minister presently in charge of the Paks expansion, has proposed that pre-works on the new plant’s foundation (working holes) should begin before the Hungarian Atomic Energy Authority approves the construction of the new blocks as a whole. If realized, this arrangement would only favour Rosatom. It would require the modification of current regulations and would carry the risk that the working holes would not entirely match the new blocks that are to be approved at a later stage. This would entail further delays and cost increases.
Environmental policy: Neglecting natural treasures
Moving ahead to environmental policy, we can safely say that the government remains largely out of sync with the country’s environmental challenges. Air quality is a good case in point: last year Hungary was referred to the Court of Justice of the European Union for not tackling illegal levels of air pollution. Under-prioritizing the natural environment is aptly reflected in the relatively low — and ever-decreasing — level of government spending on it, well below the EU’s 1.6 % average (Eurostat, 2016). Another telling fact is that in 2010, when the Fidesz government came to power, it shut down the Ministry of Environment and scattered its functions among several ministries. Environmental protection is not a ministry-level priority in Hungary, which is quite an exception among EU member states.
Perhaps most alarming within the broader context of environmental policy is the heavy-handed treatment of nature conservation in practice. The current administration has deliberately deprived those charged with managing Hungary’s 10 national parks and protecting its rich biodiversity of financial resources, legal protections and staff. Several government intrusions last year only deepened the sector’s crisis. These included a verbal order from the supervising ministry prohibiting natural parks from applying for the EU’s genetic resources conservation funds and a ban on employing staff under the government’s so-called public works scheme. Then, last November, some 40+ % of all public servants working on nature conservation were abruptly fired from the Agriculture Ministry. Conservation experts believe the weakening of the administration of protected areas can only serve prospective industry and business interests. In the process, irreversible damage is being done to the country’s rich ecosystems.
Regarding environmental protection, strictly defined (as opposed to nature conservation),at least one other development bears mentioning from last year, and that is the failed attempt to curb plastic waste. This was particularly striking because citizen action and bureaucratic process had seemed to align on the issue — at least for a while. In reaction to a petition from Greenpeace Hungary backed by 150 000 signatories, the Ministry of Innovation and Technology drafted a progressive bill that would have levied an environmental protection fee on single-use plastic bags. The proposal was cancelled at the last moment in a decision that certainly appears to cater to big retailers’ business interests.
In summary, Hungary’s score on energy policy last year was mildly positive. Upcoming new investments in solar power generation are encouraging, and the country is on track to meet its climate goals. That said, serious challenges remain concerning climate adaptation, energy efficiency in the residential sector, and the upgrading of power grids. In contrast, environmental policy, and especially nature conservation, remains largely neglected and mismanaged. The government has not put in place sufficient policies to tackle air pollution or to improve its track record on reuse/recycling of municipal waste and is doing little to raise awareness about environmental challenges. At the same time, severe staff reductions point to a deliberate downscaling of environmental protection that negatively affects climate mitigation, ecosystems, public health, and quality of life alike.
Ada Ámon (Energiaklub), András Perger (Greenpeace Hungary) and Katalin Rodics (Greenpeace Hungary) have been consulted in preparation for this article. The author thanks them for their valuable contribution and insight.