FM: Hungary will vote against EC proposal to reform European electricity market

The foreign minister said that due to the war in Ukraine and related sanctions, the situation on the EU energy market was still “rather fragile”, with natural gas prices starting to ratchet up again.

Péter Szijjártó, Minister of Foreign Affairs and Trade, said in Luxembourg on Monday that Hungary will vote against the European Commission’s proposal to reform the European electricity market, adding that the reform would take away the right of EU member states to keep utility prices low.

Minister Szijjártó told a press conference on the sidelines of an EU meeting on energy affairs that due to the war in Ukraine and related sanctions the situation on the EU energy market was still “rather fragile”, with natural gas prices starting to ratchet up again. “Gas prices are way above a historic average, even if they are below last year’s peak.” He said the bloc was not fast enough in building sufficient capacities to receive liquefied natural gas (LNG) to meet demands that gained impetus after the coronavirus-related restrictions were lifted in East Asia. Weather can also be a serious factor that can create uncertainty not only around next winter but as regards water consumption needs this summer. “In this situation, the government has a dual goal and responsibility. First, it must ensure that Hungary has stable energy supplies; second, it must also ensure that low utility prices are protected,” he said. The foreign minister referred to “serious attacks directed recently at Hungary’s utility cuts by Brussels”, adding that over the rejection of the commission’s proposal put forward on Monday, Hungary had also faced “yet another attack”.

The proposal would take away from member states the right to protect their citizens against high energy prices, Szijjártó said, adding that Brussels sought to seize the right to decide when to declare an energy crisis-related emergency and allow a member state to cut utility prices in such a situation. “This is nonsense because one of the main lessons learnt in the recent past is precisely that the realisation of the situation and quick response can help,” he said, adding that “rather lengthy and bureaucratic decision-making in Brussels” was not a solution to problems. Szijjártó noted that Hungary had previously won a lawsuit in the European Court of Justice in that regard, which he said also went to show that Brussels had no right to take away this national competence. He said Hungarians paid the lowest energy bills in Europe, “and we … will uphold this situation”. “It is utterly unacceptable of Brussels to take away this right from us, so, of course, we will vote ‘no’ to the draft reform of the electricity market.” Regarding the controversies around nuclear energy, Szijjártó said that while “attacks have not subsided”, a strong pro-nuclear energy coalition had been formed with the French leadership, of which Hungary was also a partner. “European energy security and environmental protection goals are impossible to achieve without nuclear energy,” he said. Meanwhile, Germany “has once again come up with a proposal” to impose sanctions on Russian state-owned nuclear energy company Rosatom, he said. Rosatom leads the upgrade of Hungary’s only nuclear plant, which covers half of the country’s electricity consumption, he noted. Should the proposal be formally tabled, Hungary’s government will oppose it vehemently, Szijjártó said. Germany argues that such a sanction would serve the interests of Ukraine. “We respect the interests of Ukraine but think that EU member states’ interests should weigh more in EU decision-making than that of non-members,” he said.

Regarding gas reserves, Minister Szijjártó said that Hungary had already stored enough gas to cover 39% of its needs next winter, against the EU average of 22%. Minister Szijjártó also called for the protection of critical energy infrastructure, especially the TurkStream pipeline. He said it was “nonsense” that “everyone conspicuously seems to be avoiding investigating the terrorist attack on the NordStream pipeline a few months ago”. He said that developing transit routes in southeast Europe was key to energy diversification. “Since this is a physical question rather than that of political pipedreams, the European Commission has a responsibility here,” he said. He also called for EU action against “certain EU member states and third countries which have raised transit fees by utterly unfair proportions in a way that seems coordinated,” he said. “This is not a friendly or fair gesture or one that suggests cooperation based on mutual respect,” he said. Meanwhile, Minister Szijjártó had talks with Peter Dovhun, Slovakia’s minister of economy, in Luxembourg, and discussed issues around energy policy. Minister Szijjártó said on Facebook that Hungary and Slovakia’s energy interests largely coincided. “Unfortunately, a debate has again flared up in Brussels about whether or not to impose sanctions on the nuclear industry. Therefore we have reinforced our alliance and will not surrender to pressure. We insist that defining the energy mix of a country should stay a national competency, and we will not allow the nuclear industry to be sanctioned,” he said.