Is there a way for Hungary to reduce its dependency on Russian energy?

Hungary’s strong dependence on Russian oil and gas is a heritage of the Communist era. The change of the regime could not make a difference. Only the security of supply developed thanks to cross-border pipes and a strategic gas store inaugurated in 2009. But is there a way to become free from Putin’s gas and oil deliveries?

According to 24.hu, Hungary imports 90 pc of its oil and 80 pc of its gas demand. Russia’s share in the imports of both goods is dominant. 24.hu says there are many statistics regarding the energy dependency of the EU member countries. They show that Hungary is probably not the most dependent one but it is still high on the list. After Russia had invaded Ukraine, Moscow started to send the needed gas through the TurkStream (Russia-Turkey-Balkans) pipeline system. Therefore,

the gas used in Hungary does not flow through Ukraine. Instead, it comes from the direction of Serbia. 

The country’s oil dependency is not that significant. However, it became clear in March that even MOL would not be able to process, in sufficiently large quantities, other types of oil than the Russian one without a hundred million USD investment and several years of alteration work. That is understandable. The dependency on Moscow developed in 60 years. Diversification cannot be done within a couple of months. 

In the case of the oil, it was the Communist regime that opted for the Soviet oil. When Moscow hesitated about where they wanted to build their new oil pipeline (Friendship I), the Kádár regime acted quickly to close a successful deal. The reason was that water caused more and more problems in the oil fields in Zala county. Soviets built the Friendship II pipeline in 1972.

Interestingly, the Hungarian Communist leadership not only used Soviet oil but also traded with it.

Miklós Pulai, a Hungarian economist, said that the state won 300 million USD on the business. As a result, Brezhnev reduced the supply unilaterally in 1981.

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In the case of gas, the Hungarian demand significantly increased between 1965 and 1970. The supply came from Hungarian and Romanian sources. The number of households heating with gas doubled between 1960 and 1970. Furthermore, the average consumption also rose. However, the highest increase was in the chemical industry, construction sector and machinery industry.

Soviet gas appeared in Hungary’s economy in the 1970s. 1975 marked the year of the inauguration of the Brotherhood pipeline. Meanwhile, Hungarian gas plants lost their importance. Finally, the nuclear power plant in Paks was built in 1982 using Russian technology and supply.

Hungary could not change its dependency on Russian oil and gas after the change of the regime. On top of that, all power plants built between 1989 and 2006 used gas or oil. Furthermore, household gas consumption doubled between 1989 and 2009. Meanwhile, Hungary’s gas production fell 35 pc in this interval.

In 2020, Hungarian gas supplied only 20 pc of the demand.

Orbán slammed Socialist governments for they made Hungary more dependent on Russian gas. In 2007, he said, “we do not want to be the happiest barrack of Gazprom.” The Gyurcsány cabinet signed a long-term agreement with Putin in 2008, which Orbán criticised for being classified then. Nevertheless, he did the same in 2021.

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In 2009, the government built a gas store near Szőreg which had a 1.2 bn cubic metres capacity. That is enough for 45 days.

24.hu argues that the Orbán cabinets did not help the diversification projects. They bring up the example of the Nabucco pipeline, though they admit that international developments killed the project instead of Orbán’s scheming. 

A couple of days ago, Viktor Orbán said that he would like to build Hungary’s future on nuclear and solar energy. He added that these two sources could supply 90 pc of the needs. Attila Holoda, the joint opposition’s energy policy professional said that Hungarian households use gas instead of electricity, so they are not interchangeable. Meanwhile, 24.hu argues that the Orbán cabinets did not support renewable energy. For example, they made it almost impossible to build wind power stations in the country.

Hungarian economist Zoltán Pogácsa said Orbán should have directed Hungary onto the renewable track a decade ago. Furthermore, they should have reduced consumption with insulation programmes. Moreover, they should not have signed the Paks 2 agreement with Russia but instead should have made more attempts for diversification. He highlighted that the European Union would help if the government showed commitment to change.

Read alsoHungarian government will not vote for any curbs on Russian oil and gas imports

Source: 24.hu