Hungary to launch construction of nuclear units in 2016

By bne IntelliNews November 17, 2015

Hungary will launch construction of two new units at its Paks nuclear power plant in 2016, the government commissioner in charge of the project, Attila Aszodi, said on November 17.

The first block is expected to come online by the end of 2023 or in early 2024, Aszodi told a news conference, according to Reuters. “We expect the blocks to start commercial operation in 2025 and 2026."

Budapest tore up an international tender in January 2014 to hand Russia a contract to expand the Paks plant. In return, Moscow agreed to lend Hungary €10bn to fund the project, which is likely to cost a total of €12.5bn.

The pair signed contracts on the design, construction and maintenance of the two new 1,200 megawatt reactors in December. Many details were not publicised due to "national security" concerns.

Hungary has drawn sharp criticism in Brussels over concern that the project will deepen the bloc's dependence on Russian energy. However, the only public stance on its legality taken thus far by the European Commission came in April when it informed Hungary that nuclear fuel agency Euratom has approved the contract under which Russia will supply fuel for the plant.

The green light cleared the way for Hungary to proceed with the project, although talks with the EU over public procurement and competition issues remain on the table. Opponents of the project hope the European Commission will rule that Hungary's 20% share of the construction costs will be judged to be a direct subsidy, which is illegal under competition rules, the report says.

“We still believe that the project can be implemented without the provision of state aid”, Aszodi said. EU regulators could rule over the issue in the coming weeks, the government has said.


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