Page 43 - CE Outlook Regions 2024

A string of new investments were announced in the EV battery industry as Hungary reached a record €13bn in FDI in 2023. Just before Christmas, China's BYD, the world's biggest electric vehicle maker, announced that it will build its first plant in Europe in southern Hungary. The construction will be one of the biggest investment projects in Hungary’s history. The company began the distribution of its electric cars in October, and its goal is to become one of the top three brands in the European electric car market by 2030.
The Orban government has tied the country’s industrial transition to serve electromobility, as Budapest is seeking to become a global hub in EV battery production. The country ranks fourth globally in electric vehicle battery production, and with the completion of new projects the country will be ranked second.
Of the 10 largest Asian EV battery manufacturers, five will have a production base in the country in the next few years. In the past few years, Hungary has become China’s top investment destination in Central Europe, and China is the second-largest importer after Germany.
3.3.4 Energy & power
Despite the war and sanctions, Hungary stuck by Russian state energy giant Rosatom as the main contractor to build two 1,200 MW reactors at the Paks nuclear power plant from €12.5bn, financed by a €10bn loan by Moscow. After the 2022 election victory, the government sped up the construction after Rosatom received the final licence. The two new blocks could go online in the early 2030s, a significant delay compared to the initial 2024-2025 deadline.
Hungary is also a net importer of electricity, and new capacities are vital for surging demand. Average electricity consumption in the EU may increase by 50% by 2030, and nuclear energy can provide rising demand as it is safe, sustainable, cheap and available in large quantities, allowing independence from price fluctuations, the government estimates.
Hungary's solar energy capacity continued to rise at a rapid pace as financially savvy households, hit by the partial lifting of energy subsidies and rising gas and electricity prices, sought cheaper alternatives. In January-October, 1,500 MW of new capacity was added to the grid, bringing the total to 5,500 MW. Capacities are set to reach the 6,500 MW target in 2024, six years before the 2030 date. At the end of the decade, some 90% of the country’s electricity production could be carbon-free. The government lifted the ban on solar energy feed-in to the grid from the end of 2023 and announced new tariffs. The ban was introduced in October 2022 on the grounds that Hungary's grid was overburdened by soaring renewable supply.
43 CE Outlook 2021 www.intellinews.com