C 312/164
EN
Official Journal of the European Union
1.9.2023
The impact of such transactions on the economy, competition and the single market is not being assessed.
The criteria for the exemptions are not set out transparently, and there is no formal procedure to contest those criteria or the decision itself.
As a result of the interventions, State or State-friendly domestic ownership has increased in banking, telecommunications, utilities, media, TV and radio broadcasting, to the detriment of foreign ownership.
Based on announcements by members of the government, similar transactions can be expected in insurance, retail and the transport sector, in particular regarding Budapest Airport.
The decreased presence of foreign capital and know-how, in particular in high-value-added industries such as banking and telecommunications, risks curbing Hungary’s opportunities for productivity growth and innovation.
(38)
Hungary’s energy mix is determined by oil and gas, each accounting for about one third of overall energy use.
Nuclear and renewable energy sources have a share of 15 % and about 14 %, respectively.
Hungary continues to rely heavily on Russia for fossil fuels as well as nuclear power and its efforts to shift away from Russian dependence are slow.
Three quarters of the domestic gas consumption is covered by imports from Russia.
In 2021, Hungary signed a long-term gas supply agreement with Gazprom and an amendment to it was negotiated in April 2023, with an option for additional quantities.
Decreasing dependency on Russian fossil fuels will require significant additional action, in particular to strengthen cooperation with neighbouring countries, including where necessary on infrastructure, to ensure access to alternative fossil fuel sources.
Electrification and the envisaged investment in energy-intensive industries will increase the need for electricity production.
Despite the significant increase in solar energy capacity in recent years, the share of renewable energy capacity is still one of the lowest in the Union.
The installation of wind power plants has been suspended and is expected to resume after the removal of legal restrictions.
Geothermal energy has been underutilised.
The frequently changing regulatory environment poses several challenges to the development of renewable energy.
In addition, the limitations of the electricity grid’s capacity create a significant bottleneck for connecting renewables to the grid, while the lack of flexibility solutions on the demand and supply sides, and limited consumer empowerment, create a major constraint on the development of clean, renewable electricity production.
Suboptimal integration into the Union balancing market is also a missed opportunity to optimise the grid for additional renewables capacity.
(39)
Hungary has significant potential in energy efficiency, in particular in residential buildings.
Hungary’s consumption of natural gas dropped by 20 % in the period between August 2022 and March 2023, compared with the average gas consumption over the same period in the preceding 5 years, beyond the 15 % reduction target laid down in Council Regulation (EU) 2022/1369 (16), also due to measures in the public sector and the amendment of the energy price cap system applied for households.
Hungary is encouraged to keep pursuing efforts to temporarily reduce gas demand until 31 March 2024, pursuant to Council Regulation (EU) 2023/706 (17).
Nevertheless, despite the recent changes, the administrative prices system on energy still does not allow price signals to work properly and to create sufficient incentives for energy savings.
Price caps are uniformly applied to all households.
High-income households also benefit from the subsidised administrative price, while low-income families often live in less energy-efficient homes.
Targeted schemes for low-income households would be more efficient, both in supporting vulnerable households and generating energy savings.
(40)
Labour and skills shortages in sectors and occupations key for the green transition, including manufacturing, deployment and maintenance of net-zero technologies, are creating bottlenecks in the transition to a net-zero economy.
High-quality education and training systems that respond to changing labour market needs and targeted upskilling and reskilling measures are key to reducing skills shortages and promoting labour inclusion and reallocation.
To unlock untapped labour supply, those measures need to be accessible, in particular for individuals and in sectors and regions most affected by the green transition.
In 2022, labour shortages were reported in Hungary for 31 occupations that require specific skills or knowledge for the green transition.
At the same time, worker participation in training in energy-intensive industries has significantly declined and is now below the Union average.
(41)
In the light of the Commission’s assessment, the Council has examined the 2023 Convergence Programme and its opinion (18) is reflected in recommendation (1).
(16) Council Regulation (EU) 2022/1369 of 5 August 2022 on coordinated demand-reduction measures for gas (OJ L 206, 8.8.2022, p. 1).
(17) Council Regulation (EU) 2023/706 of 30 March 2023 amending Regulation (EU) 2022/1369 as regards prolonging the demandreduction period for demand-reduction measures for gas and reinforcing the reporting and monitoring of their implementation (OJ L 93, 31.3.2023, p. 1) (18) Under Article 9(2) of Regulation (EC) No 1466/97.