State aid for nuclear energy could distort Europe’s energy market, says Austria embassy official
Budapest, April 18 (MTI) – Every country has the right to establish its own energy mix but the state support of nuclear power could distort competition on Europe’s liberalised energy market and hamper the spread of renewables, the Austrian embassy’s agricultural attache said in Budapest on Monday.
Speaking at a conference dealing with the upgrade of Hungary’s sole nuclear plant in Paks, Ernst Zimmerl said one of the Austrian government’s concerns about the project was that the Hungarian government awarded a contract for the upgrade of the Paks plant without calling a tender. This does not comply with European Union rules on public procurements, he said.
Zimmerl said EU competition law must also be observed, adding that his government rejects all forms of direct or indirect state aid for nuclear energy projects.
He said he was convinced that, when it comes to nuclear power, the primary goal of the Hungarian and Austrian governments is enhancing nuclear security, regardless of how different their views may be on the use of nuclear energy.
He noted that last year the two countries held talks on an environmental impact study, which brought them closer to agreements on a number of matters regarding nuclear security.
Zimmerl said nuclear accidents do not stop at country borders, emphasising the importance of transparency in the field of nuclear energy, which is also prescribed by EU law.
He said it was “very worrying” that the Hungarian government classified details of the agreement with Russia on the Paks expansion project for 30 years.
Benedek Jávor, a MEP for the Dialogue for Hungary (PM) party, said the most important European Commission investigations into the project were the ones dealing with the suspected involvement of state aid and the government’s failure to call a tender for the upgrade. Jávor said he suspected that the government and the EC could reach an agreement regarding the government funding for the project around the autumn. In this agreement, the EC could declare that the project does indeed involve state aid, but may choose to allow it citing “special circumstances”. Jávor noted that the government had already amended the agreement with Russia concerning the plant’s radioactive fuel supplies as well as the law pertaining to requests for data in the public interest regarding the project.
Zsuzsanna Koritár, an expert of the Energiaklub climate policy institute, which organised the conference, said the biggest problem with the project was that the government had failed to provide a valid reason for the investment as a whole. There are no alternative solutions for ensuring Hungary’s energy supply which could serve as a basis for comparison, she said. Koritár said the official budget for the upgrade was 3.75 trillion forints (EUR 12bn), but the government had failed to take into account incremental costs which she said could reach 2 trillion forints.
Attila Aszódi, government commissioner for the Paks upgrade, responded to the speakers’ remarks saying that the Paks project fully complies with the EU’s energy policies. The European Commission aims to keep its capacity to produce nuclear power stable in the long run, he told MTI.
He said that while Austria is capable of producing 60 percent of its electricity by hydropower, Hungary is not so fortunate.
Aszódi said 27 percent of Europe’s electricity is produced by nuclear plants and 14 of the 28 member states have nuclear reactors. The fact that these plants are able to produce power 24 hours a day gives Europe a huge advantage in terms of its energy security and environmental protection. He noted that 10 member states are in the process of building or planning nuclear power plants, citing Slovakia, France and Finland as examples. He said Hungary and Austria’s cooperation regarding the Paks project was “fair”. Hungary invited 30 countries to take part in the environmental impact study. At Austria’s request, the study also included public and expert consultations, where Hungary answered every question that came up. At the end of March, Austria indicated that it considered the process complete and that it would discuss any remaining technical questions through bilateral talks, Aszódi said. He said the Hungarian government strongly supports renewable energy.
Aszódi said the project did not require state aid to be competitive and profitable. He said the EC’s investigation into the project was not about state aid and expressed hope that the commission would wind up its investigation and state a position by the middle of the year. He said the government did consider alternative sources for Hungary’s energy supply but the plan containing nuclear energy turned out to be the best long-term solution.
As regards the costs of the Paks upgrade, Aszódi said Hungary signed a fix-priced contract with Russia’s Rosatom, meaning that the project will not require any additional spending.