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Only a few years ago, the Hungarian National Energy Strategy set
the then ambitious target of reaching 6 GW of solar power
capacity by 2030. By early 2024, that target had already been
achieved, as the gross capacity of PV installations doubled within
only two years. The new target for 2030 is now set at 12 GW,
and there is little doubt that it will be easily reached.
The joy of the Hungarian energy policymakers is matched by the
sorrow of many investors. The government’s latest decision in
this area (Government Decree 54/2024 (III.6.)) practically
eliminated the possibility for any new renewable energy projects
(with very limited exceptions) to receive a grid connection with
feed-in-capacity. This came short after the launch of the second
round of the recently revised grid connection allocation procedure,
where the developers submitted capacity applications in the
magnitude exceeding 10 GW. Unfortunately for many, as the grid
connection rights required to install the 6 GW additional PV
capacity to reach the 2030 target were already issued earlier, the
decisionmakers opted to annul the procedure and refuse most new
applications. According to the Government Decree, a completely new
grid connection capacity allocation regime will be prepared by the
end of 2024, indicating no realistic way to obtain new feed-in
capacity for weather-dependent renewables in the near future. On a
separate note, the recent changes do not affect the development of
on-site (self-consumption only) power plant projects.
Nevertheless, Government Decree 54/2024 also opened a new window
of opportunity for investors looking for Hungarian renewable energy
projects. The Hungarian Energy and Public Utility Regulatory
Authority (“HEA”) is now required to create and publish a
database on its website of all weather-dependent power plant
projects with a capacity of at least 0.5 MW that have already
obtained a grid connection offer or grid connection agreement. This
may also include projects under development and operational units.
For each project, the new database will include, among others, the
name of the developer, the geographical identification data of the
connection point, the available feed-in capacity, the type of
installation and its primary energy source, the envisaged
connection date and the amount of connection fee payable. The HEA
will publish the database for the first time by
7 April 2024 and will update it on a quarterly basis.
From the perspective of interested investors, the HEA’s
database will contain all relevant data regarding the total
6 GW solar capacity under development and intended to be
commissioned by 2030. In other words, for the very first time,
Hungary will have a true public “marketplace” where
potential buyers, investors and finance providers can seek out and
contact the developers of the last wave of PV projects to
facilitate transactions, joint ventures or other forms of
cooperation. We anticipate it becoming a pivotal tool for
stakeholders and stimulating the solar generation unit market.
The first publication of the HEA’s database will likely
signal the last chapter of the solar power gold rush that reshaped
Hungary’s energy landscape over the previous ten years. After
reaching the 12 GW threshold, the demand for new PV generation
capacities may become negligible in the already overstretched
Hungarian electricity market. Since 2014, when total installed PV
capacity was 0.077 GW, favourable and stable subsidy schemes
(FiT, CfD), relatively low property prices, a simple capacity
allocation regime, and global economic and technological
developments have resulted in an unprecedented volume of
investments in PV installations and created a whole new industry.
Stakeholders will now “finish the job” and install the
second half of the targeted gross 12 GW solar capacity by
2030. Given the experience of the first 6 GW, the upcoming
years are expected to deliver further lucrative deals for
developers, investors, suppliers and finance providers as well.
Additionally, the HEA’s incoming database is poised to become
the starting point for many future success stories.
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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