Hungary also needs to update its National Energy and Climate Plan (NECP). It looks to be a great opportunity for domestic decision-makers and citizens to reconsider about energy matters. How much energy will we need in 2030? How much and what kind of energy will we be able to produce ourselves? What mix should we create in the energy transition that puts the least burden on the
environment and on our health?

Changes in energy matters – let’s take the right direction!
In recent decades, crisis-resistant and renewable energy has gained ground. Technologies utilizing the sun’s energy have undergone enormous development: today’s solar panels are cheaper and more productive. Wind power plants have also developed a lot: the blades, which are often up to
100 meters high and are made of fiberglass plastic that is also used for airplanes, can make use of weak breezes too, and their sound effect is much lower. Added to all this was the fossil energy crisis, energy price rocketing – at still not back to Earth.

National Energy and Climate Plan: a good opportunity to revise future

Hungary, as all EU member states, must update its National Energy and Climate Plan (NECP). This seems to be a great opportunity for domestic decision-makers and citizens to revise energy matters. How much energy will we need in 2030? How much and what kind of energy will we be able to produce ourselves? What mix should we create in the energy transition that puts the least burden on the environment and on our health?

NECP, if gives proper frame for well-selected and carefully planned measures, can speed up energy transition, i.e. the transition to an energy-saving, renewable energy-based economy. With all of this, we can not only save billions, but we can also live in more livable buildings and achieve climate
neutrality sooner. However, there are some things that we would not like to see in the NECP that is now being formed, because they hinder energy transition.

Energy security – based on import?

Previous NECP also emphasized the goals of  “strengthening energy independence” and “energy sovereignty”. It also states that “dependency on energy imports can carry serious risks in terms of security of supply and of price volatility”.

In recent years, an energy-intensive re-industrialization, which requires much more energy, has come to the fore. We are witnessing the return of fossil gas-fired power plants and nuclear power plants.

Hungary has a certain amount of natural gas (it produces 1.5-2 billion m3 per year), but this dwarfs the country’s annual gas demand of 10-11 billion m3, most of which is imported from Russia). 100% of the uranium used in Paks nuclear power plant is imported from Russia (uranium mining in Hungary
ended in 1996 due to uneconomical operation). For both energy sources, imports maintain our dependence.

The government’s current priority in declarations is electrification, domestic electricity production; significant part of the public funds is planned to be spent on this. At the same time, it is necessary to consider what kind of energy source electricity is produced from, where and how. Importing electricity – based on more and more renewable energy – within the EU may be more advantageous than if they wanted to produce it with new domestic power plants operating with imported fossil or nuclear fuel.

Decarbonization or recarbonization – with gas and lignite?

The current NECP (adopted in 2020) aims to reduce greenhouse gas emissions by at least 40% by 2030 (compared to 1990). This was confirmed by the 2020 Climate Protection Act and also by the National Clean Development Strategy 2020 – 2050, which examined in detail what steps and measures could lead to the planned reduction of greenhouse gas emissions. Both documents considered decarbonization essential: “drastic changes are needed to decarbonize Hungary’s energy supply system”.

While the recent energy crisis prompted European countries to accelerate their decarbonisation measures, Hungarian government appears to turn backwards. In March 2023, the public procurement of new gas turbines of the Mátra Power Plant and Tisza Power Plant was announced (3 gas power plants, for a total output of 1,600 megawatts).

The step is sometimes justified as the replacement of the "retired" base Mátra Power Plant. Indeed, the phase-out of lignite-based energy production has been also stated in the previous NECP, however, the planned gas power plant is not a base power plant. Other times it is explained by the
balancing of weather-dependent renewables; and sometimes by (non-industrial) electrification. And rarely it is confessed that new gas power plants will be needed by the increased electricity demand due to forced reindustrialization. It is worrisome if the establishment of the three new gas power plants is justified by the “re-industrialization” of Hungarian industry – indicated as green – (for example, battery production), which is particularly energy-intensive and has little added value. This increases the vulnerability of the economy, while entailing a high demand for natural resources and
energy, as well as high environmental and health risks.

Future energy demand of the industry is difficult to estimate or plan, especially in the light of the fact that the industrial facilities to be settled will be rightfully expected to produce their own electricity needs – hopefully in a carbon-neutral way, based on renewable energies. In any case, the planned gas power plants will, according to calculations, require about 1.5 billion m3 of gas per year, and would result in the maintenance of dependence on imported (Russian) gas for decades to come.

At the same time, it is planned that the lignite blocks of the country's largest (fossil) power plant, the Mátrai Power Plant, which were shut down some time ago, would be restarted and all lignite/biomass blocks would be operated until 2029. Decision on this is expected at the end of June 2023, in any case, preparations have been made. This does not provide solution to the fossil energy crisis, but it would slow down domestic energy transition in the short and medium term; it would maintain and even aggravate our dependence on fossil fuels. In the coal regions, especially in the counties of Borsod-Abaúj-Zemplén and Heves, it would hamper the so-called just transition process.

Objective of just transition – also supported by EU funds – is the transition to a climate-neutral economy, where developments and investments take place in a fair manner: by creating permanent jobs and retraining related to climate-friendly, green economy development – so that the main beneficiaries are local small, and medium-sized enterprises, municipalities, and the employees themselves. As long as they are busy in recruiting labour for the operation of lignite blocks and lignite mines for years, new trainings and green economy developments obviously cannot begin, and counties may also lose out on EU funds for just transition.

It is also on plans to increase residential lignite use, with possible support until 2029, residential coal burning and population’s dependence on lignite would permanently increase. This means that during heating seasons throughout the country, but especially in the carbon-intensive counties, the health- damaging level of air pollution from residential heating would remain for many years to come. Use of gas and lignite emits orders of magnitude more greenhouse gases than the use of renewable energy. Hungary also has ratified the Paris Agreement. The continued use of lignite and gas not only aggravates and prolongs the fossil energy crisis, but also leads to a serious lock-in of fossil
dependence, which sets Hungarian energy sector, households and climate protection on an unfavourable path for many years and decades.

Revision of National Energy and Climate Plan provides great opportunity to rethink common energy issues. Let’s speed up the energy transition, i.e., the change from a fossil energy-based economy to an energy-saving, renewable energy-based one! Let’s achieve climate neutrality as soon as possible! You
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Download necps report — march 2023