Finding the Key to the Future of Energy in Hungary

Conferences

From left: BBJ editor-in-chief Robin Marshall, State Secretary for Energy and Climate Policy at the Ministry of Technology and Industry Attila Steiner, DUIHK president András Sávos, head of group strategy at MOL Group Viktor Sverla, and Linde Gáz CEO Ákos Hegedűs.

The latest event in the CEO Breakfast Briefing series took place today (Wednesday, September 28), with a panel consisting of Attila Steiner, State Secretary for Energy and Climate Policy at the Ministry of Technology and Industry; Viktor Sverla, head of group strategy at MOL Group; Ákos Hegedűs, CEO of Linde Gáz, and DUIHK president András Sávos discussing the future of energy.

Held at the Anantara New York Palace Hotel, the event, which was organized by the German-Hungarian Chamber of Industry and Commerce (DUIHK) in partnership with the Budapest Business Journal, started with a presentation by Steiner, who outlined the Hungarian government's plans to tackle the energy crisis. 

"In terms of security of supply, we have progressed quite well. It's better to have some gas with high prices than to have none," he noted. 

He also said that Hungary is well-positioned in terms of transitioning to sustainable energy sources, but added, "We have to speed up our endeavor to decrease energy dependence on Russia." This means that Hungary will work on updating its electric grip in order to allow more solar facilities to connect.

Steiner also noted that while domestic gas production at the moment covers approximately 15% of Hungary's consumption, there is work in progress to increase this ratio to about 20%.

In terms of support to businesses, the state secretary argued that measures should be tailor-made for different sectors, and help should be provided to SMEs who are looking to make themselves more energy efficient.

In the long term, Hungary is aiming to complete a EUR 16 billion investment plan in alternative energy until 2030, Steiner explained. The plan includes some 31 sub-projects and would cover the bulk of the country's climate-neutrality goals.

After the state secretary's presentation, a panel discussion followed, where Steiner said that there are currently five proposals by the European Commission on the table in order to tackle the energy crisis. He said that an EU-wide price cap on gas imports might be detrimental to Central Europe, as it cannot cope with cuts in delivery if Russia decides not to supply more (or any) gas at the prices set by the EU.

Viktor Sverla concurred with this argument saying, "As an economist, I cannot imagine how a thing like that could work."

Addressing the current energy situation in Hungary, he told the audience that MOL is doing its best in Hungary, even if the fuel situation is not the same as Hungarians have gotten used to in the past 20-30 years.

Regarding windfall taxes, he noted that while companies are not happy about them, they still have to be reasonable in order to help those in need. In the case of the introduction of an EU-wide windfall tax, he pointed out that the general framework would have to be harmonized with national frameworks, as companies in countries such as Hungary, where a tax on extra profits is already in place, would be at a disadvantage on the international market.

András Sávos, who is also the vice president, head of digitalization and process optimization at Knorr-Bremse, said that while his company does have some energy-related problems, he is lucky as they have a long-term electricity contract in place.

He also emphasized the importance of investing in sustainability projects. Knorr-Bremse started such a program some two decades ago, but it was in the last five-to-seven years that the company started major investments in sustainable energy. Sávos added that it had decided to accelerate the program while also considering in which areas they can make savings.

Ákos Hegedűs explained how hydrogen could be a key alternative form of energy in the future, noting how the interest in the alternative energy source is reflected in the fact that he had some 2,000 hydrogen-related business meetings in the last two years. However, regarding the current crisis, he admitted, "It is not the solution. Although it can help in the decarbonization process, it also requires investments."

He also argued that the recent appearance in Hungary of two personal cars running on hydrogen are little more than "dog and pony" shows, but noted that hydrogen as a fuel source for buses and trains could be an important factor in a greener future.

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