Hungary is one of the European Union’s most reliant members on Russian energy. The country aims to eliminate Russian gas imports by 2050 through a large-scale electrification project. Hungary to switch from Russian gas to green electricity, announced Hungarian technology and Industry minister Laszlo Palkovics.
Hungary’s reliance on Russian gas
It is known Hungary receives 4.5 billion cubic meters (bcm) of gas per year via Bulgaria and Serbia. A long-term agreement with Russia signed last year provides this. The deal was made before the start of the war in neighboring Ukraine.
In July, nationalist Prime Minister Viktor Orban’s government lifted a long-standing cap on utility prices for higher-usage households. Palkovics predicted that would lead to a drop in retail gas consumption.
The plan is to swap gas for green electricity
He said that the government would review Hungary’s energy strategy in the first quarter of 2023. The primary goal is to reduce the country’s reliance on gas and increase electricity production. The plan is to produce electricity through nuclear and solar energy. The government is considering the possibility to shift toward wind farms as well.
At the energy conference organized by financial news website portfolio.hu, Palkovics said if other conditions are equal, the level of Russian gas can fall to zero by 2050.
Palkovics added households, which used 4 bcm of gas last year, are likely to cut consumption. Accordingly, gas consumption should drop by at least 800 million cubic meters after curbing the subsidies. Cutting subsidies will create more savings for investing in green energy.
Reducing gas consumption, increasing renewable energy
As a first step, Hungary aims to reduce its reliance on gas in total energy consumption to 26% by 2030, down from 35% last year, a decrease of about 2.4 billion cubic meters, according to Palkovics.
He estimated that the Hungarian energy system overhaul, which would include reducing gas consumption, increasing the share of renewable energy, and increasing storage capacity, would cost around 24 billion euros, with the EU contributing 16 billion.