Centre for Economic and Regional Studies Hungarian Academy of Sciences Centre of Excellence

Energy Governance in Hungary

John Szabo, Csaba Weiner and András Deák

Abstract

Hungarian energy governance conveys a unique disposition, filled with contradictions, lacking clarity, but reflecting centralized control at the highest echelons of politics. Like many of its Central and Eastern European (CEE) neighbors, it is still entrenched in preexisting producer-consumer relations that shape its amicable relations with Russia, while its accession to the European Union has led it to take on disruptive climate and energy policy targets. The country’s energy transition has been unfolding slowly, as the government maintains a moderate pace of action. The diffusion of renewables continues to unfold in the shadow of other historical legacies, most prominently Russia-sourced nuclear power technology, natural gas, and oil. Power and control over energy corporations is concentrated in the hands of those closely aligned with the government, and multilevel governance is subordinated to anticipate or execute the objectives dictated by political leaders. Challenges mount in the Hungarian sector as we move towards the 2030 and 2050 EU decarbonization targets, which will pressure the government to implement much more disruptive measures, severing and rewriting historical energy based ties.