Gas shortage in Hungary – who will lose supply?

Gergely Gulyás, the prime minister’s chief of staff, declared a state of energy emergency last week. As a result, the government modified the utility price cap scheme and decided to fill its storage facilities. Furthermore, foreign minister Péter Szijjártó announced that in addition to the amounts fixed in long-term contracts with Gazprom and Shell, Hungary would purchase 700 million cubic metres of gas. Anyway, Gulyás said that it might happen in the following months that there would not be enough gas. But what happens then? You may find answers below.

Gas emergency to be declared in Hungary?

Journalists asked Gulyás multiple times whether there is an “emergency shutdown plan” in Hungary. He confirmed only the information but shared no additional details. He added he was not sure that plan was public. However, G7.hu found those plans and shared a summary of what happens if Hungary runs out of gas.

The Hungarian economic news outlet suggests that Russia will not deliver gas on Nord Stream 1 and will cut such deliveries to Europe because of the arms deliveries. Gazprom reduced its gas export to Germany by 40-60 percent in the last few weeks. Furthermore, since the start of the maintenance work of the Nord Stream 1 pipeline, the EU has received 70 percent less gas. In the case of Hungary, the amount decreased by 12 percent.

The European Commission is also preparing for a drop in gas deliveries. The EC will probably propose this week that public buildings should only be heated up to 19 °C, and citizens should start saving gas voluntarily. The goal is to evade an emergency shutdown in Europe. The Hungarian government does not talk about a possible shortage. The Orbán cabinet draws public attention only to the high gas prices. They say the utility price cap scheme needed to be modified and linked to average consumption because of the sky-high prices.

• Read also: Government drafting new rules for caps on utility bills

Here is the emergency shutdown plan

But Hungary has an emergency shutdown plan if the natural gas supply does not meet demand. The plan’s aim is to protect household consumers and the district heating system from the consequences. Key institutions in the scheme are the Hungarian Energy and Public Utility Regulatory Authority (HEA) and the Ministry for Innovation and Technology.

The law describes three levels of a gas emergency. First is the forecast, next is the warning, the third is the emergency level. At the forecast level, the sector’s companies have to submit daily reports to the HEA. At the next level, a committee forms to analyse the situation. The body makes suggestions to the minister, but the state does not interfere with the market. The main rule is that in the case of emergency, households, hospitals, retirement homes, and non-industrial users have to be protected.

If there is a constant shortage, a shutdown process will start.

First, power plants producing electricity switch to oil using their reserves. The big industrial, commercial and agricultural consumers are next that do not produce staple foods. The steps are the following: users above 2,500 m3/h, then consecuently 500 m3/h and 100 m3/h. Finally, even companies using below the 100 cubic metres per hour threshold must close.

• Read also: This Hungarian city might serve as model how to replace Russian gas

Maximum heating temperature

Afterwards, the companies producing staple food come, including slaughterhouses, milk producers, and bakeries. If somebody does not comply, they have to bear the legal consequences.

If there is a gas emergency, gas transit can be reduced. Furthermore, the government can introduce public holidays, and limit the opening times of public institutions, shops, and offices. Moreover, they can determine the maximum heating temperature.

The final source in the system is the European Union. Member states can ask each other for quick help if their gas supply is insecure. If Hungary runs out of gas, it cannot happen that the Austrian industry still works at a maximum level. Vienna has to help Budapest with gas in that case and vice versa. That is how citizens can be protected at an EU level.

• Read also: Current gas reserves equal 1/4 of annual consumption

It happened already before

HEA told G7.hu that despite the state of energy emergency the government declared last week, they did not even introduce the forecast level.

The shutdown scheme was last used in 2009 January when the Russians stopped delivering gas to Hungary because they debated with the Ukrainians.

On January 7, authorities decided to limit the gas use of the large industrial users. As a result, the Suzuki in Esztergom, brickyards, the Gyulai Hús, and Tondach stopped production. Quick help came from Austria so they could continue the work on January 8.

Source: G7.hu