Dr. Andor Nagy MP, Hungary Vice Chairman of the Environmental Committee

The Challenge for a European sustainable energy policy

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I. 2008 The year of crisis

What is the impact of the crisis?

Crisis are motivating the changes

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II. The Hungarian energy sector

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II. The Hungarian energy sector

The two main characters of the energy sector

1./ total dependence on Russian import

2./ supporting system

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III. The Hungarian energy dependence on import

- 2007: the total energy dependence on import in Hungary more than 73%

- 2020: more than 85%, according forecast of the accepted Hungarian Energy Policy

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III. The Hungarian energy dependence on import

In today's Russia, energy is itself the tool of influence. To use it the Kremlin needs three things: control over Russian energy reserves and production, control over the pipelines snaking across its territory and that of its neighbours, and long-term contracts with European customers that are hard to break. All three are in place. For all the talk of a common strategy towards Russia, the EU is divided and stuck for an answer.

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III. The Hungarian energy dependence on import

The Eastern and Middle European

socialist inheritance

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IV. The Hungarian energy supporting system

What does it mean in

the Hungarian reality?

- The Hungarian state spend much

more money to the social subsidies on energy as to the renewable energy

- 2007: the total cost of the social subsidies in the energy prizes: more than 320 million EUR

- 2007-2013: the total cost of the subsidies of the renewable energy sources: 253 million EUR

- 2007-2013: the total cost of the

subsidies of energy efficiency: 154 million EUR

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V. The RES in Hungary

3 September in 2008. the Hungarian Government approved the Hungarian Renewable Energy Strategy (2008-2020)

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V. The RES in Hungary

The share of RES in the

gross final energy consumption was 4.3% in 2005.

Today, the most important renewable energy source is biomass, representing 90% of all RES production

Hungary has fantastic opportunities for the use of geothermal energy

Breakdown of renewable energy sources in production

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V. The RES in Hungary

- Hungary is blessed with a

wealth of natural resources for biofuel, biomass, biogas, geothermal, wind and solar energy

- the share of renewables in the energy mix is relatively low at present

- Hungary enjoys huge potential for renewable energy use, especially in the area of photovoltaic, biomass and geothermal energy production

Maximum renewable energy potential (PJ)

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V. The renewable energy in Hungary Hungary’s targets

for renewable energy production

1./ RES in energy production 2020

11%-16%

2./ Renewable electricity production 2020

186 PJ

3./ Renewable heat production 2020

87 PJ

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Accessible targets by the Hungarian Energy and Environment Operation al Program (2007-2013)

2007 2010 2013 2015

Growth of the RES based elecricity production

GW/year 0 676 967 1170

Accessible targets the share of RES in the Hungarian energy consumption by the KEOP

% 0 2,6 3,3 3,4

VI. Conclusions and recommendations

- The EU target for Hungary 13% is achievable but more potential

- As for Hungary it is a national interest to have a common European sustainable energy policy

- More ambitious goals are needed at the national level

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VII. What to do?

1./ More subsidies from state and EU Funds

2./ Remove administrative burdens in the permit process

3./ Enhance intensity of support4./ Green card for buildings, fix price not

just for electricity but also for biogas, heating and cooling from RES

5./ More support in R&D for RES6./ Tax reduction for biofuels

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VII. The result

1./ New technologies2./ Innovation3./ Creating added value and

employment4./ Reduction of CO2 emissions

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Thank you for your attention!17