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19 July 2010

Hungary ambitious about climate policy goals

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One of the priorities of the EU's new 'Europe 2020' strategy is green growth: the goal is to reduce CO2 emissions and energy consumption by 20% and increase the share of renewables in the bloc's energy mix to 20%. For Hungary, the biggest challenge will be renewable energy.

Some countries feel that the 20% reduction in CO2 emissions is less than the EU is capable of achieving. Germany and the UK have increased the stakes and set themselves the goal of 40%, which Hungary will also try to achieve.

Many commentators believe 40% is not impossible, since Hungarian emissions have already decreased by 25% since 1990 due to the restructuring of the economy after the end of socialism – under which heavy industry thrived.

This reduction has created a paradoxical situation: Hungary will have more emissions quotas in 2020 than it had in 2005. Under the next phases of the EU's emissions trading scheme, which will begin in 2013, Hungary has been granted a 10% quota increase in recognition of the efforts made in recent years. Yet some say the abolition of socialist structures was not an achievement, but a requirement.

Emissions reduction is a profitable undertaking for the country. As former MEP Péter Olajos told EurActiv Hungary in an interview, Hungary could generate over €3.5bn by keeping emissions at current levels and selling its additional quotas.

In the future, it is not production decreases that will improve results, but promoting renewable energy and boosting energy efficiency. It is in Hungary's best interests to improve its energy efficiency and decrease its consumption, not least due to the country's huge reliance on imported energy – around 70%.

Hungary's energy consumption trends reveal a less favourable picture than the EU average. Although total energy consumption fell by almost 10% between 1990 and 2004, the proportion of gas consumption grew by 30%, mainly for heating buildings.

In 2006, only 4.7% of energy consumption came from renewable energy sources and it was only in 2003 that the share of renewables in the energy mix began to grow, thanks to a favourable subsidy system. Biomass is the most widely-used renewable source in Hungary, followed by geothermal energy.

In 2008, the EU set Hungary the goal of 13% growth in its share of renewables, which the country accepted. According to research by the European Wind Energy Association, this can be achieved within the given timeframe – though the current share of renewables in the energy mix is around 5%.


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