Hungary Powers Through with Paks Nuclear Plant Expansion Defying EU Stance on Russian Energy Links

Despite mounting pressure and calls to cut all energy ties with Russia in Brussels and some European capitals, the construction works on the Paks-2 project are progressing as scheduled.

Despite mounting pressure and calls to cut all energy ties with Russia in Brussels and some European capitals, the construction works on the Paks-2 project are progressing as scheduled. Hungary will never agree to stop or slow down the project. By trying to push companies like German Siemens or French Framatome into quitting Paks, EU politicians are just shooting themselves in the foot. Companies would be losing business and facing astronomic fines for breaching binding contracts.

“Hungary’s security of supply is a national interest. And the national interest dictates that we have to increase our nuclear energy capacities, and this is only possible if we build new nuclear power plant blocks,” Péter Szijjártó, Hungary’s Foreign Affairs and Trade Minister said at a joint press conference in Paks with Alexey Likhachev, the head of the Russian nuclear energy company Rosatom. He pointed out that the expansion of the Paks nuclear plant is currently the largest nuclear project in Europe which has obtained a construction license.

Szijjártó said the European Union is split over nuclear energy, and Hungary is firmly a member of the bloc of its proponents led by France. Hungarian leadership, including Prime Minister Viktor Orbán, have repeatedly voiced the government’s unwavering commitment to the construction of Paks-2 project. According to the government, the Paks-2 project is vital to Hungary’s energy security and meeting its climate targets.

The Paks II project began in 2014 when Hungary signed an agreement with Russia for the construction of two VVER-1200 reactors alongside the existing Paks plant about 100 kilometres from Budapest. Following calls by antinuclear groups, the European Commission launched several inquiries into the project, which held back its implementation for several years, but eventually gave its final approval in 2017. The construction licence was issued in August 2022. The project is estimated to create over 10,000 jobs and boost Hungary’s GDP growth by 1% per year.

Earlier in November, Szijjártó and Likhachev signed a protocol detailing an updated schedule ensuring that the new power units would start generating electricity by the early 2030s.

Hungary is insisting on carrying on with energy cooperation with Russia and has been blocking all attempts to extend the EU sanctions over Ukraine to the nuclear sector and Russia’s nuclear giant Rosatom. “Nuclear energy is an area where neither politics, geopolitics, nor sanctions have any place,” said Hungary’s Foreign Minister Péter Szijjártó. “We have made it clear that we do not agree to any sanctions that would affect the field of nuclear energy,” he added. Szijjarto said the twelfth sanctions package against Russia, currently being prepared by the EU, does not include such proposals. He maintained, however, that Hungary will never agree to any sanctions affecting the nuclear industry sector.

Hungary has recently signed an agreement with Romania for the transportation of Russian nuclear fuel for the Paks Nuclear Power Plant through that country. In November, Mr. Szijjártó announced that the first shipment delivered from Russia via the Black Sea and then by rail through Bulgaria and Romania had arrived in Hungary, effectively bypassing Ukraine.

“The fuel will continue to be delivered in accordance with the contracts, guaranteeing the safe and predictable operation of the Paks nuclear power plant,” – the minister said. Mr. Szijjártó said he was pleased with working with Rosatom, calling its performance “excellent”, both in terms of the quality of the fuel and the precision of the timing of shipments.

Mr. Szijjártó said Hungary is working closely with the IAEA, the UN nuclear safety watchdog, to ensure international recognition that the project meets the highest safety standards. The IAEA says it “fully supports” the project.

Russia has provided Hungary a credit line of up to €10 billion for the construction of the Paks-2 Nuclear Power Plant on favourable conditions, including borrowing flexibility and deferred interest payments.

Hungary also works with the French nuclear firm Framatome, which, in conjunction with Siemens, supplies an automatic control system for the reactors. The Hungarian officials say that the collaboration complements its work with Rosatom but does not replace it. The project also involves the American company General Electric, which, together with the French company Alstom, supplies turbine-generator equipment for the new Hungarian nuclear power plant.

Hungary considers nuclear energy vital to ensuring the country’s energy security. The currently operating Paks nuclear power plant, with its four Russian VVER-440 reactors built in 1982, provides about one-third of Hungary’s energy needs.

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