The Green Policy Center, under the umbrella of the MIRROR project, aims to help Hungary prepare for the process of reviewing its National Energy and Climate Plan – lasting till June 2024 – with modelling-based proposals. Below is a list of key messages and proposed targets for Hungary and sectoral policy proposals.

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Key messages and proposed targets

1) The investments already planned with EU funds in the period 2021-2027 and the market-based interventions resulting from high energy and carbon quota prices will allow Hungary to reach its 2030 emissions target in force today. However, the country would not even come close to the 2050 climate neutrality target if it were to follow this path. In other words, the current medium-term 2030 target does not ensure that we will reach the long-term target we have set ourselves, and we need to raise this 2030 target.

2) To that end, further steps and policy interventions are also needed in the areas of renewable energy and energy efficiency, as well as in reducing Hungary’s (fossil) energy import dependence, also compared to the draft of the revised NECP.

3) In light of the EU’s increased 2030 target, the revised draft NECP and the Commission’s recommendations thereon, we modelled an optimal green transition path for Hungary. This predicts a much more robust trajectory, with much faster progress than currently planned for the period up to 2030. However, with the increased ambition levels for 2030, the 2050 climate neutrality target can be achieved on a more balanced pathway overall.

4) In terms of funding, there could be in the order of HUF 10,000 billion of uncommitted EU and domestic resources available for climate action over the period 2024-2030, with increased reliance on already committed EU funds and private capital. The efficient use of these funds for long-term climate goals is a key national strategic issue and a golden opportunity not only for climate policy but also for the long-term sustainable social and economic functioning of our country.

5) We propose the following targets for Hungary, taking into account the recent information that the Paks-II nuclear power plant cannot yet help us to achieve the 2030 targets:

–       a 60% net reduction in greenhouse gas emissions by 2030 compared to 1990, and

–       35,5% share of renewable energy in final energy consumption in Hungary,

–       regarding energy efficiency keep Hungary’s final energy consumption below 655 PJ in 2030,

–       Furthermore, it is already worth setting a target of at least a net 85% GHG reduction by 2040, also compared to 1990, so that all elements of the pathway are clear for all.

6) Achieving the emissions reduction target at the economy-wide level is greatly helped by setting sub-targets at sectoral or other levels. This also has the advantage of making it clearer to individual actors what their roles and responsibilities are in achieving the common target. Work should therefore continue in this direction when finalising the NECP. The GHG target should also be set on a net basis.

7) Raising both the energy efficiency and the renewable energy targets reinforces each other. But to achieve the higher ambition, it will require not only smart investment but also a change in energy consumption patterns. The way to further increase the renewable energy target compared to the revised draft NECP could be mainly wind, geothermal and biomethane, and only to a lesser extent solar. The power system of the 21st century needs to be balanced with 21st century solutions, not with expensive to run and polluting gas power plants.

8) Awareness-raising activities are key to achieving a higher level of ambition. Many people are motivated by a climate-conscious lifestyle. Based on small-scale national experience to date, an average of 5-15% energy savings can be achieved in homes and offices simply by changing behavior, habits and practices. In some cases, there are examples of multiple times this amount. Awareness raising can be even more effective if infrastructure improvements support the availability of the more sustainable options.

9) Achieving these targets is realistically achievable even with increasing industrial production, although it will undoubtedly require considerable effort and commitment. However, our past results, the high level of social support for the 2050 climate neutrality target (93.6%), the associated benefits of the necessary interventions (energy sovereignty, improved quality of life, preservation of natural assets, etc.) and the need for our country to operate in a sustainable and climate resilient manner in the long term provide a good basis for doing so. Below is a summary of the key actions proposed by the Green Policy Center.

Our proposals for achieving the increased 2030 Hungarian climate targets that we suggest, in each sector:

Buildings:

1.  We need to create the domestic manufacturing capacity, design and construction specialist base for the materials and equipment needed for the mass renovation of the building stock!
2. New buildings will not solve the problem, those that can still be saved should be renovated using sustainable and environmentally friendly materials and processes!
3. Price control of household energy prices: maintain an investment-incentive price environment for large consumers!
4. Without state support, it is impossible to achieve the necessary renovation rate, long-term support programmes must be launched!
5. More stringent energy efficiency requirements for new houses!
6. All sustainable solutions should be used to ensure sustainable energy supply in buildings!
7. Information and regulation should be used to influence consumer and investor behaviour in relation to energy efficiency.
8. The focus should be on energy retrofitting of the worst performing buildings, which is the most beneficial option for GHG emission reduction in the sector. This requires carefully designed policies and the allocation of resources to this objective.
9. While striving to phase out fossil-fired boilers, improving the energy efficiency of buildings must not be overlooked.

Transport:

1.  More opportunities for teleworking and home-based services are needed, so as a more thoughtful urban development!
2. Encourage a shift to public transport and active modes of transport (modal shift)!
3. Fewer cars with higher occupancy rates!
4. Low-emission cars and public transport vehicles are needed!
5. Reduce freight transport demand and distances!
6. Reduce the share of road freight transport!
7. Low-emission vehicles for freight transport should be introduced!

Land use and waste:

1. Increase bioenergy production, especially biomethane, with market regulations!
2. Plant much more trees, of species more resistant to the negative effects of climate change!
3. Encourage the reduction of food waste!
4. Encourage healthier and more climate-friendly eating habits, locally produced and seasonal products!
5. Promote greening of agricultural energy use!
6. Help agriculture adapt to a changing climate!
7. Accelerate progress towards a circular economy!

Small industrial and energy production installations:

1. Strengthen the energy efficiency obligation scheme!
2. Support the financing of industrial energy transition investments by SMEs!
3. Climate protection agreements should be concluded with industrial sectors!
4. Coordinated and rapid development of the electricity grid, solar and wind energy is needed!
5. Accelerate the Green District Heating Programme!
6. Ban new consumers from connecting to the gas grid to reduce dependence on natural gas!
7.  Eliminate fugitive emissions from the extraction and transportation of natural gas and oil!

Large emitters:

1. Maintain the EU ETS system which limit the biggest polluters!
2. Keep at the forefront of innovative technologies!
3. Create the external conditions necessary for the technological transformation of large industrial emitters!
4. Support the domestic uptake of innovative, sustainable manufacturing technologies!
5. When designing new industrial installations or those undergoing major refurbishment, it should be mandatory to consider the possibilities for further green development!
6. Green solutions for power and heat generation, oil refining and natural gas systems should be adopted.
7.  Restrict short-haul passenger air traffic and the use of private jets!

Funding for climate action:

1. Use available resources for climate and energy in a well thought-out, efficient and predictable way, with proper monitoring!
2. The Hungarian national budget should continue to make a significant contribution to climate goals!
3. Speed up the absorption of EU funds already available!
4. Increase the use of direct EU funds!
5. Simplicity, professionalism and a holistic approach should be encouraged in the development of calls for proposals.
6. Increase transparency in the spending of green funds!

A detailed set of proposals is available on the Green Policy Center website (in Hungarian):

Javaslatcsomag a 2030-as klímacélok eléréséhez

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