State institutions, companies ordered to cut gas consumption by 25 pc — UPDATED

Hungary’s government has ordered public institutions and state-owned companies to cut their gas consumption by 25 percent as an energy-saving measure, the prime minister’s chief of staff said on Thursday.

The rule does not apply to hospitals and social-care institutions, Gergely Gulyás told a regular press briefing.

Gulyás said the energy supply situation was difficult all across Europe and rising energy prices had caused an economic crisis.

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“It’s clear that the sanctions policy has not lived up to expectations,” he said.

The government will cap firewood prices and launch a scheme to support energy-intensive SMEs.

Firewood will be also available for purchase in forestries, which will be able to provide 10 cubic meters of wood for all customers, enough to heat a private household through the winter, Gergely Gulyás said.

The government will also launch a “coal programme”, and raise the limit of open-cast mining from 50,000 tonnes to 280,000 tonnes, he said.

Small and medium sized companies with high energy needs will receive support to foot their gas and electricity bills, he said.

The price of district heating will not rise, and the government will launch a programme to provide all flats on the grid with individual meters, he said.

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Hungary is currently running the largest household utility price support programme in Europe, he said. Price subsidies, up to average consumption, are available up to 150,000 forints (EUR 375) per household, he said.

Meanwhile, Gulyás said the government will cap firewood prices. Firewood will be also available for purchase in forestries, which will be able to provide 10 cubic meters of wood for all customers before the heating season, enough to heat a private household through the winter, he said.

The government will also launch a “coal programme” in the coming days, and raise the limit of open-cast mining from 50,000 tonnes to 280,000 tonnes, he said. The government will have pre-emption rights on the lignite produced, he added.

Small and medium-sized companies with high energy needs will receive support to foot their gas and electricity bills, he said. The government will develop a support scheme to ensure that supply lines remain intact, albeit with shrinking profits, to avoid mass unemployment that would result from interruptions to supply lines, he said.

The price of district heating will be kept level, and the government will launch a programme to provide all flats on the grid with individual meters, he said. The latter will involve some 140,000 apartments and take 4-5 years, he said.

Concerning Hungary’s talks with the European Commission, Gulyás said consultations were ongoing on the procedure regarding the conditionality mechanism which links EU funding, the post-pandemic recovery fund and the seven-year EU budget to the rule of law. The EC aims to conclude the conditionality mechanism procedure first, and the government has accepted this, Gulyás said.

The government agrees with the EC that the efficient and transparent utilisation of EU funds is a shared interest, he said, adding that the government has provided all the guarantees the commission has requested, adding that the two sides had reached an agreement on every professional matter.

Gulyás expressed hope that the talks conducted in Brussels by Justice Minister Judit Varga, Tibor Navracsics, the minister for regional development, and Janos Boka, the state secretary for EU affairs, would produce results. He also called on leftist MEPs to stop working on “blocking Hungary, Hungarian teachers and health-care workers, from the EU funds Hungary is entitled to.”

Meanwhile, Gulyás said Hungary will revamp its bond strategy. The state debt management centre (AKK) will issue bonds with an initial interest rate of 11 percent, the “best offer on the market”, this September, he said.

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Source: MTI