COMMISSION STAFF WORKING DOCUMENT Country Factsheet Hungary Accompanying the document COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE, THE COMMITTEE OF THE REGIONS AND THE EUROPEAN INVESTMENT BANK State of the Energy Union
Date: 2015-11-18
Institutions: European Commission, Secretariat-General
Subjects: Hungary, competitiveness, economic and social cohesion, electrical energy, energy policy, gas, innovation, reduction of gas emissions, regional cooperation, single market

EN 

   EN 

   EUROPEAN COMMISSION  Brussels, 18.11.2015  SWD(2015) 227 final   COMMISSION STAFF WORKING DOCUMENT Country Factsheet Hungary Accompanying the document COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE COUNCIL, THE EUROPEAN ECONOMIC AND SOCIAL COMMITTEE, THE COMMITTEE OF THE REGIONS AND THE EUROPEAN INVESTMENT BANK  State of the Energy Union {COM(2015) 572} {SWD(2015) 208 à 209} {SWD(2015) 217 à 226} {SWD(2015) 228 à 243}  
 
 
Towards an Energy Union  
           Hungary 

Macroeconomic relevance of energy 

IMPORTANCE OF THE ENERGY SECTOR 

The energy sector plays an important role in the Hungarian economy, where its contribution to the gross value 
added and to employment is much greater than the European average. Recently, the contribution of energy to 
gross  value  added  increased,  whereas  the  share  of  total  employment  in  the  energy  sector  remained  quite 
stable between 2005 and 2012. 

Source: EUROSTAT – National Accounts 

According to EurObserv'ER, in 2013, the share 
of  direct  and 
indirect  renewable  energy 
related  employment  in  total  employment  of 
the economy in Hungary was at about 0.18%, 
below the EU average of 0.53%. 

Source:  European  Commission,  based  on  EurObserv'ER  and 
EUROSTAT 

TRADE BALANCE OF ENERGY PRODUCTS 

Hungary  is  a  net  importer  of  energy  products,  mainly  due  to  considerable  oil  and  gas  imports,  even 
though  the  contribution  from  electricity  import  also  increased  between  2006  and  2014.  The  energy 
trade deficit is higher than the EU average. In 2006, the current account and the energy trade balance 

0.00.40.81.21.62.02.42.820052012HUEU27Value added of energy sector% of grossvalue added (total economy)0.00.20.40.60.81.020052012HUEU27Employment in energy sector% of total employment 
 
 
 
 
 
 
 
 
 
 
 
 
Towards an Energy Union - Hungary 

were  both  in  deficit.  By  contrast,  in  2014  the  net  positions  in  the  accounts  diverged:  the  current 
account was in surplus, while the energy balance was still in deficit.  

Source: EUROSTAT 
Note: Current account balance for EU28 from European Commission (AMECO) 

1. Energy Security, solidarity and trust 

ENERGY MIX 

The energy  mix of  Hungary  is  relatively  similar  to  that  of  the  EU-28,  with the  notable  difference  of  a 
higher  share  of  gases  and  nuclear.  Compared  to  1995,  the  share  of  renewable  energy  and  nuclear 
increased  more  than  the  EU  average  (from  3%  to  9%  and  from  14  to  18%  of  gross  inland  energy 
consumption  respectively),  while  the  share  of  gases  slightly  decreased  (by  3  percentage  points)  The 
main  decrease  concerns  the  use  of  solid  fuels  (by  8  percentage  points).  The  share  of  low  carbon 
emission  energy  sources  (if  renewables  and  nuclear  are  put  together)  was  slightly  above  the  EU 
average. 

Gross inland energy consumption in 2013  

Source: European Commission, based on EUROSTAT  

IMPORT DEPENDENCY 

For  overall  fossil  fuels,  Hungary's  import  dependency  is  higher  than  the  EU28  average.  Import 
dependency for petroleum products is  at the EU average, while that of gas is above, although having 

2 

-8-6-4-20246HUEU28% of GDPCoalOilElectricityGasC. A. BalanceTrade balance of energy product and currentaccount balance, 2006 -8-6-4-20246HUEU28% of GDPCoalOilElectricityGasC. A. BalanceTrade balance of energy product and currentaccount balance, 2014  
 
 
 
 
 
 
 
 
 
 
 
 
Towards an Energy Union - Hungary 

decreased since 2005. Hungary imports gas almost exclusively from Russia1. Hungary has a significant 
energy trade deficit, expressed as percentage of GDP.  

Source: European Commission, based on EUROSTAT  

2. A fully-integrated internal energy market 

INTERCONNECTIONS 

The Hungarian interconnection capacity for electricity was 29% in 2014, 
which  is  above  the  2020  target.  Additional  interconnectors  between 
Hungary  and  Slovakia  would,  among  others,  allow  increased  electricity 
imports in the mid-term. 
In  the  case  of  gas,  the  main  element  that  requires  urgent 
implementation and hence was also identified as very important project 
in  the  European  Energy  Security  Strategy  is  the  reverse  flow  from 
Romania towards Hungary and the reverse flow from Croatia to Hungary. 
This  project  would  allow  future  Black  Sea  sources  to  flow  towards 
Hungary and Austria / Slovakia and would increase trade already in the 
short  term.  The  reverse  flow  from  Croatia  would  connect  Hungary  to 
Liquefied  Natural  Gas  (LNG)  and  other  western  gas  sources.  The 
Hungary-Slovakia  gas  interconnector  became  operational  as  of  1  July 
2015,  giving  Hungary  access  to  competitively  priced  North  and  West 
European gas markets and thereby allowing the diversification of supply 
routes and sources.  

Source: European Commission based 
on ENTSO-E scenario outlook and 
adequacy forecast 2014 
Note:  Reference  to  2030  target  is 
based  on  October  2014  European 
Council  conclusions  stating  that 
"the  Commission  will  also  report 
regularly  to  the  European  Council 
with the objective of arriving at a 
15% target by 2030" 

1  

Top non-EU gas suppliers table is based on EUROSTAT data. The share of imports from non-EU countries is calculated 
as the ratio between volumes of imports from that specific non-EU supplier and total imports  (from EU and non-EU 
countries). 

3 

Top non-EU gas suppliers in 2013 (% in total imports)HungaryEuropean Union country[%]country[%]Russia95.0Russia39.0Not specified5.0Norway29.5Algeria9.7Qatar6.763%52%81%84%81%72%52%53%82%87%57%65%200520132005201320052013All fuelsPetroleum andproductsNatural gasHUEU28Import dependency 2013 
 
 
 
 
 
 
 
 
 
                                                                 
Towards an Energy Union - Hungary 

ELECTRICITY AND GAS MARKETS 

Market concentration index for power generation (left) 
and gas supply (right) (2013) (Herfindahl index – 10000 means 
monopoly) 

Sources: European Commission based on ESTAT, CEER and Platts 
Power Vision 

Sources:ESTAT and European Commission Calculations 

The concentration of power generation (based on installed generation capacities) in Hungary is below 
the  EU  average,  while  the  concentration  of  the  wholesale  gas  market  is  high,  primarily  owing  to  the 
dominant import supply source and to the decreasing share of  indigenous production in the national 
consumption. Wholesale gas and electricity prices are comparable with EU average. In September 2012, 
the market coupling of the Czech, Slovak and Hungarian day-ahead markets was successfully launched 
(Romania joined in 2014).  
Retail market performance indicators show no signs of competition at retail level. Switching rates for 
electricity and gas markets are insignificant in the case of households, while for industrial consumers 
switching rates are higher. In 2013 and 2014 significant retail electricity and gas price cuts have been 
implemented  by  the  government.  As  a  result,  by  the  end  of  2014  electricity  and  gas  retail  prices  for 
household  consumers  were  down  by  more  than  20%  compared  to  2012.  In  combination  with  other 
regulatory  measures  (e.g.  special  levies  in  the  energy  sector)  and  market  interventions,  network 
operators and energy suppliers suffer financial losses in the regulated utility business segment, implying 
that  current  retail  electricity  and  gas  prices  are  not  fully  cost  reflective.  According  to  an  EU-wide 
survey2, consumer's satisfaction with regard to the retail electricity market in Hungary is slightly below 
the  EU average while  it  is  lowest  in  the  EU  in  the  case  of  the  gas  market.  Following  a  first  economic 
assessment of long term costs and benefits, there is no legal framework  in Hungary for a  mandatory 
roll-out of smart metering. Instead, it has been decided to undertake  a further assessment of related 
costs and benefits (scheduled by end 2016) based on results from ongoing pilots. 

CONTRIBUTION OF ENERGY TO CONSUMER PRICE EVOLUTION 

Energy prices have contributed to inflation to a large extent until recently. From 2005 to 2012 their 
contribution was positive while more recently their effect on consumer prices is  negative, an effect 
linked to the falling oil prices. This recent trend is more evident in Hungary than in the EU and can be 
at  least  partially  explained  by  the  high  contribution  of  oil  imports  to  the  Hungarian  energy  trade 
balance. Another contributing factor is the recent round of price cuts in regulated households energy 
prices (-25-30% on energy prices) implemented by Hungarian authorities in 2013-2014. 

2  
http://ec.europa.eu/consumers/consumer_evidence/consumer_scoreboards/10_edition/index_en.htm 

10th Consumer Markets Scoreboard (June 2014),   

4 

 
 
 
 
 
 
 
 
 
                                                                 
Towards an Energy Union - Hungary 

Source: DG ECFIN based on Eurostat 

VULNERABLE CONSUMERS 

Based  on  a  EUROSTAT  survey  on  income  and 
living conditions, three proxy indicators are used 
to  assess  fuel  poverty.  The  values  presented  on 
the chart indicate  that fuel poverty  is  a relevant 
issue  in  Hungary.  Since  2008,  the  legislation 
recognises vulnerable consumers on a social and 
on  a  health-related  basis.  Depending  on  their 
category vulnerable consumers may benefit from 
options, 
deferred 
individual 
consumers 
understand their bills, etc.  

prepayment 
to  help 

payment, 
assistance 

Source: European Commission, based on on EUROSTAT SILC survey 

3. Energy Efficiency and moderation of energy demand 

ENERGY EFFICIENCY TARGET 2020  
(24.1 Mtoe primary energy and 14.4 Mtoe final energy) 

its  2020  energy 
Hungary's  recently  updated 
efficiency target, as comparing to the previous one 
reported in 2014 (from target number 26.6 to 24.1 
Mtoe  expressed  in  primary  energy  consumption 
and  from  18.2  to  14.4  Mtoe  expressed  in  final 
energy  consumption3),  did  not  seem  to  incentivise 
improvements  in  energy  efficiency,  as  the  2013 
annual figures were already significantly lower than 
the 2020 target. This target was based on forecasts 
made before the global economic downturn at the 
end  of  the 
implying  higher  than 
currently  foreseeable  energy  demand  for  the 
forthcoming years.  

last  decade, 

 Source:  European  Commission,  based  on  EUROSTAT  and  on 
national  energy  efficiency  targets  as  declared  by  the  MS  under  the 

Energy Efficiency Directive 

3  

It should be noted that the Hungarian national statistical definition of final energy consumption includes non-energy 
consumption  as  well.  For  this  reason  the  new  energy  efficiency  target  number  is  defined  as  693  PJ  (16.6  Mtoe), 
mentioning  603  PJ  (14.4  Mtoe)  target  without  non-energy  consumption  in  the  new  National  Energy  Efficiency  Plan, 
approved as the Decision of the Government 1601/2015. (IX.8.). 

5 

-20246820052007200920112013% increase on a year earlierNon EnergyEnergyAll itemsHungary : Price evolution & the contribution of energy prices-10123420052007200920112013% increase on a year earlierNon EnergyEnergyAll itemsEU28 : Price evolution & the contribution of energy prices 
 
 
 
 
 
 
 
 
 
 
                                                                 
Towards an Energy Union - Hungary 

The  new  2020  energy  efficiency  target  is  better 
streamlined to the new economic environment. It is 
clear that the trend of primary energy consumption 
decoupled from the evolution of the GDP over the 
last  decade.  Yet,  Hungary  needs  to  continue  its 
current efforts in order to meet the updated energy 
efficiency 
the  current 
economic rebound continues in the next five years.  
On  20  February  2015  the  Hungarian  Government 
adopted  the  new  scenario  for  primary  energy 
consumption 4 . 
In  accordance  with  the  new 
is  committed  to  decrease 
scenario,  Hungary 
primary  energy  consumption  by  10.4%  until  2020 
compared to 2005. 

target,  assuming 

that 

ENERGY INTENSITY 

Primary  energy  intensity  in  Hungary  has  decreased  significantly  since  2005,  though  it  remained 
significantly above the EU average. Although recent trends showed an improvement in energy intensity 
in the industrial sector, this trend was reversed in 2013.  
Primary energy intensity of the economy    

Final energy intensity in industry 

Source: European Commission based on  EUROSTAT 

Source:  European  Commission  based  on    EUROSTAT  and  European 
Commission/AMECO 

Final  energy  consumption  in  households  in  Hungary  is  still  slightly  above  the  EU  average,  though  it 
showed  rapid  decrease  since  2005.  The  specific  energy  intensity  of  passengers  cars  and  freight 
transport decreased slightly between 2005 and 2010 and it is well below the EU average.  

Final  energy  consumption  per  m2 
residential sector, climate corrected 

in 

Specific energy intensity for passenger cars and freight transport5  

Source: European Commission based on  Odyssee 

database 

Source: PRIMES model background data and estimations based on EU Commission 
and EU MS inputs   

4  

5  

The new National Energy Efficiency Action Plan has been adopted by the Hungarian government and communicated to 
the European Commission in September 2015. 
Statistics  on  energy  demand  for  passengers  and  freight  transport  are  not  available  and  model  estimates  have  been 
used instead. These issues should be borne in mind when comparing energy intensity in freight or passenger transport 
between Member States, which should be regarded as merely indicative. 

6 

 
 
 
 
 
 
 
 
                                                                 
Towards an Energy Union - Hungary 

EU legislation sets mandatory CO2 emission reduction targets for new cars and vans. By 2021, the fleet 
average  to  be  achieved  by  all  new  cars  is  95  grams  of  CO2  per  kilometre.  For  new  vans,  the  fleet 
average is set at 147 g/km by 2020. 

Source: European Environmental Agency. 2014 values are provisional. 2013 EU average refers to EU-27. 

Regarding transport performance, in  EU-28  the inland freight modal  shares  are  71%  by  road,  17%  by 
rail,  7%  by  inland  waterways  and  5%  by  pipelines.  The  respective  inland  passenger  modal  shares  are 
82% by private car, 9% by buses and coaches, 7% by railways and 2% by tram and metro. Compared to 
the  rest  of  Europe,  Hungary  reports  the  highest  share  of  buses  and  coaches  use,  and  in  general  the 
highest share in public passenger transport use. 

Modal share Hungary 

Source: Eurostat and EU transport in figures 2015. Data refers to 2013. Modal shares based on tonne-kilometres for freight sector and 
passenger-kilometres for passenger sector, freight data based on activity within country territory. Estimates are made when data is missing. 

7 

 
 
 
 
 
 
 
 
 
 
Towards an Energy Union - Hungary 

4. Decarbonisation of the economy 

NON-ETS GHG EMISSION REDUCTION TARGET 2020  
(+10% by 2020 as compared to 2005 in the non-ETS sector) 

to  2005 

lower  by  30% 
(based  on  2014 

In  2014  emissions  were 
compared 
approximate data). 
According  to  the  latest  projections,  Hungary 
is  on  track  to  reach  its  greenhouse  gas 
emission  reduction  target  for  2020,  with 
approximately a 40% margin as compared to 
2005.  

Source:  European  Commission    based  on  EEA.  Based  on  preliminary 
inventory data. 

ESD  (Effort  Sharing  Decision)  emissions  are  the  emissions  from  sectors  not 

covered by the EU ETS. 

Emissions 

Non-ETS 
(vs. 2005) 
Projections with 
existing measures 
2020 
Proxy 2014 

Projections/proxy 

target 

-30% 

-30% 

+10% 

-3% 

RENEWABLE ENERGY SHARE TARGET 2020 (13%) 

With  a  renewable  energy  share  of  9.8%  in 
2013,  Hungary  is  currently  on  track  to  reach 
its  13%  target  in  2020.  In  comparison  to  its 
National  Renewable  Action  Plan  (NREAP), 
Hungary is in line with its indicative trajectory 
for  renewable  heating  and  cooling  and 
transport  sectors.  However,  the  share  of 
is  below  the  value 
renewable  electricity 
envisaged  by  NREAP.  Therefore  additional 
efforts  need  to  be  made  to  ensure  that  the 
2020 target is met. 

Source: European Commission based on  EUROSTAT 

GREENHOUSE GAS EMISSION INDICATORS 

  Greenhouse gas emissions per capita in Hungary are about 30% below the EU average. At the 
same time, due to the low GDP in Hungary, the carbon intensity of the economy is nearly 75% 
higher than the EU average. 
In 2014 revenues from the auctioning of ETS allowances amounted to EUR 56.5 million. 

 

8 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Towards an Energy Union - Hungary 

Largest Sectors of GHG 
Emissions in 2012 (*) 

Energy/power industry  

Transport 

Industry  

Agriculture (incl. forestry & 
fishery) 

Residential & Commercial 

Waste & others 

Hungary 

EU 
Average 

30% 

18% 

14% 

15% 

18% 

5% 

33% 

20% 

19% 

12% 

13% 

3% 

GHG Emissions 

Hungary 

EU 

EU ETS auctioning revenues 
in 2014(EUR millions) 

Share of ETS emissions in 
2013 

GHG emissions/capita in 
2013 (tCO2equivalent) 
Carbon intensity of 
economy in 2013 
(tCO2equivalent/EUR 
millions) 

56.5 

3205 

34% 

42% 

5.7 

8.5 

570 

328 

(*)Sectoral breakdown for 2013 data not available 

Source: European Commission  based on EEA 
. 

ENERGY & TRANSPORT TAXATION 

The  share  of  energy-related  and  transport-related  taxes  compared  to  GDP  is  broadly  in  line  with  the 
EU-average. The main share of the tax burden can be linked to transport fuels, followed by the share of 
taxes on transport vehicles. Tax burden on heat and electricity was of comparable magnitude with the 
EU  average  in  2005,  however,  by  2012  it  decreased  significantly  and  became  lower  than  the  EU 
average. 

Source: Eurostat 

5. Research, innovation and competitiveness 

RESEARCH AND INNOVATION 

Hungary  is  above  the  EU  average,  the  US  and  South  Korea  in  terms  of  the  share  of  public  support 
allocated  to  research  and  innovation  in  the  field  of  energy  and  environment.  In  terms  of  intensity  of 
low-carbon  technology  patents,  Hungary  is  lagging  behind  the  EU  average  and  the  main  worldwide 
partners. Hungary faces new challenges in managing its energy transition and therefore is active in the 
field of research in nuclear technologies.  

9 

0.01.02.03.0HUEU-28Energy & Transport related taxes % of GDP, 2005TransportvehiclesTransport fuelHeat &Electricity0.01.02.03.0HUEU-28Energy & Transport related taxes % of GDP, 2012TransportvehiclesTransport fuelHeat &Electricity 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Towards an Energy Union - Hungary 

Source: European Commission based on  EUROSTAT   

COMPETITIVENESS 

The real unit energy costs6 for the manufacturing 
sector  have  remained  higher  in  Hungary  than  in 
the EU or in the US. This reflects that the energy 
intensity7 of  Hungary's  manufacturing  sector  is 
higher  than  in  the  EU  and  in  line  with  the  US, 
in 
while  real  energy  prices  have 
Hungary  over  the  past  ten  years.  Thus,  energy 
prices are higher than both the EU average and in 
the US.  
More  specifically,  electricity  prices  paid  by 
industrial  customers  are 
line  with  OECD 
average, while for gas, they are slightly above. 

increased 

in 

Real unit energy costs (% of value added) 

Source: European Commission 

Source: European Commission based on EUROSTAT and IEA 

6. Post-2020 Energy and Climate policy Strategy  

COMPREHENSIVE MEDIUM TO LONG-TERM STRATEGY (post-2020) 
FOR CLIMATE AND ENERGY  

  Hungary  has  set  a  general  strategy  for  energy  and  climate  for  the  period  post-2020,  although 

mostly without specific targets for 2030.  

  The energy-related medium-term objectives are outlined in the  2030 National Energy Strategy, 
adopted  by  the  Parliament  in  2011,  which  covers  the  key  issues  of  energy  savings  and  energy 

6  
7  

This indicator measures the amount of money spent on energy sources needed to obtain one unit of value added. 
The  energy  intensity  presented  here  is  derived  from  Use  Tables  of  WIOD,  see  "Energy  Economic  Developments  in 
Europe SWD(2014)19". 

10 

17.59.58.219.613.28.820.013.78.00510152025HUEU27US200020092011 
 
 
 
 
 
 
 
 
 
 
 
 
                                                                 
Towards an Energy Union - Hungary 

efficiency, renewable energy, nuclear energy, and integration of the Hungarian energy market. A 
biennial review of the Strategy is foreseen. 

  The 2008 National Climate Change Strategy covers the period until 2025 and includes conditional 
GHG reduction targets, which will be set based on targets established at EU level. An update of 
the  Strategy  (2nd  National  Climate  Change  Strategy)  has  been  drafted,  taking  into  account  the 
evolution  of  the  EU  2030  framework,  though  it  still  has  to  be  finalized  and  adopted  by  the 
Parliament.  The  Hungarian  Low  Carbon  Development  Strategy  and  a  National  Adaptation 
Strategy  are  also  planned  to  be  part  of  the  Strategy  update,  along  with  the  Hungarian 
Decarbonisation  Schedule  analysing  the  scenario  of  reducing  GHG  emission  by  40%  until  2030 
and by 80-95% until 2050. 

NATIONAL TARGETS, especially for 2030 

Objectives, 2030-2050 

Targets  

GHG reduction  

Yes (only for 
2025) 

Comments  
Conditional  target  for  2025    16%  to  25%  reduction 
compared to 1990 level in case of a 20% EU 2020 target; 27% 
to 34% reduction compared to 1990 level in case of 30% EU 
2020 target 

Renewable energy  

Yes 
(indicative) 

Indicative  forecast  for  2030    share  of  renewables  in 
primary energy use expected to reach 20% by 2030 

Energy Efficiency / savings 

No 

The Energy Strategy does not include a specific 2030 target. 
However,  it  has  the  purpose  of  reducing  by  30%  heating 
energy  requirements  of  buildings  by  2030.  The  energy 
consumption by 2030 should not be higher than before the 
economic crisis. 

7. Regional cooperation  

Hungary  participates  in  the  Central  East  South  Europe  Gas  Connectivity  (CESEC)  High  Level  Group, 
operational since the beginning of 2015. The objective of this group is to establish and implement a 
regional  priority  infrastructure  roadmap  in  order  to  improve  interconnections  and  security  of  gas 
supplies.  

Hungary is one of the coordinators of the energy related actions in the "EU Strategy for the Danube 
Region",  which  groups  fourteen  countries  (both  EU  member  states  and  non-member  states).  The 
primary  aim  of  this  cooperation  process  is  to  coordinate  energy  policies  in  the  involved  countries. 
The  strategy  is  implemented  by  mobilising  and  aligning  existing  funds  to  its  objectives,  where  it  is 
appropriate  and  in  line  with  overall  frameworks.  The  specific  actions  cover  energy  infrastructure 
development,  for  example,  "The  Danube  Region  Gas  Market  Model";  the  "Danube  Region  Gas 
Storage Analysis" or the "Danube Region Smart Grid Concept". Other actions cover renewables, for 
example the "Danube Region Geothermal Concept" and the "Danube Region Biomass Action Plan" or 
other actions, such energy efficiency. 

Hungary actively participates in the cooperation of the Visegrad 4 Group (CZ, HU, PL and SK) in the 
field of energy policy. V4 aims at regional integration of the energy markets in particular for the gas 
and electricity sectors and with the Allegro project in the nuclear sector. The Allegro project is aimed 
at demonstrating the operability and technological feasibility of gas-cooled fast reactors.  

The Czech, Slovak and Hungarian day-ahead electricity wholesale markets have been coupled since 
September  2012  which  Romania  joined  in  November  2014.  The  price  convergence  between  these 
countries  reached  76%  after  the  launch  of  the  market  coupling.  The  Central  Allocation  Office 

11 

 
 
 
 
 
 
 
 
 
 
 
Towards an Energy Union - Hungary 

manages the allocation of longer term capacity rights in the whole Central-East region, and with the 
exception of the borders of CZ, SK, HU and RO it manages the day-ahead capacity allocation on all 
other Central-East borders. 

8. Cohesion policy contribution  

The EU Cohesion policy provides for important investment possibilities to implement energy policy 
objectives  in  Hungary  which  will  be  complemented  by  national  public  and  private  co-financing, 
aiming at optimal leverage. It also ensures integrated territorial solutions to challenges by supporting 
capacity  building,  technical  assistance  and  territorial  cooperation,  including  the  macro-regional 
strategy for the Danube Region in which Hungary takes part. 

Energy efficiency: Over 2014-2020, EU Cohesion Policy will invest some EUR 1 245 million in energy 
efficiency improvements in public and residential buildings and in SMEs, as well as in district heating 
in Hungary. A further estimated EUR 2 439 million will be invested in supporting the move towards 
an energy-efficient, decarbonised transport sector. These investments are expected to contribute to 
around  76  000  households  with  improved  energy  consumption  classification  and  a  decrease  of 
around 67 251 000 kWh per year of decreased primary energy consumption of public buildings, as 
well as  to  around 470  km  of  reconstructed  or  upgraded  railway  lines,  130  km of  new  or  improved 
tram and metro lines and 50 km of new or improved inland waterways. 

Decarbonisation:  Overall,  the  EU  Cohesion  Policy  investments  in  Hungary  over  2014-2020  are 
expected  to  contribute  to  an  estimated  annual  decrease  of  GHG  of  around  2  964  000  tonnes  of 
CO2eq. Over 2014-2020, EU Cohesion Policy will invest some EUR 876 million in renewable energy in 
Hungary. These investments are expected to contribute to around 1 980 MW of additional capacity 
of renewable energy production. 

Research,  Innovation  and  Competitiveness:  Over  2014-2020,  EU  Cohesion  Policy  will  invest 
significantly  in  R&I  and  in  SME  competitiveness  in  Hungary.  This  will  be  based  on  the  national 
strategy for smart specialisation. For Hungary, the Strategy includes a focus on clean and renewable 
energies and on advanced technologies in the vehicle and other machine industries. At this stage, the 
allocations foreseen for investments in R&I and adoption of low-carbon technologies in Hungary are 
not  specified,  but  should  become  available  in  line  with  the  evolving  content  of  the  smart 
specialisation strategy. 

12