In line with the most recent European Union Gas and Electricity Market Directives, all electricity and gas customers can freely select their supplier as of 1 July 2007. An act on electricity (Act LXXXVI of 2007) was adopted by the Hungarian Parliament, supporting full liberalization of the electricity market in order to enhance economic competitiveness and provide sustainable security of supply. The Act is harmonized with the requirements of the European Union. The provisions of the Act came into force partly from 15 October 2007 and from 1 January 2008. In the beginning of 2008, the electricity market became fully liberalized. Nevertheless, 2008 is considered a transition period, as the players in the market had to adapt to the new rules. The non-residential Hungarian electricity consumers pay for substantial subsidies to the renewables and combined heat and power sectors through levies on their tariffs. The new premium based renewable support scheme (METÁR) was accepted by the Hungarian National Parliament in 2016, and it will be introduced in 2017.

In February 2008, the National Climate Change Strategy for the period of 2008–2025 was adopted by the Hungarian Parliament. The strategy emphasizes the need for increasing energy efficiency, energy savings and the use of renewable energies (wind, solar, geothermic, biomass). It does not mention nuclear energy as part of the concept.

In April 2008, a resolution on a new energy policy concept for the period of 2008–2020 was adopted by the Parliament. The Hungarian energy policy aims at maintaining a balance between security of supply, cost effectiveness, energy efficiency and protection of the environment. According to the resolution, the Government should start working on the preparation of the decision on new nuclear capacity for the replacement of the old plants, and the proposal should be submitted to the Parliament in due time. The resolution also says that the Government should create the necessary conditions for the implementation of the programmes aimed at the final disposal of radioactive waste, and that the Government should inform the Parliament on the implementation of the energy policy at least every two years and in case of need it should propose the review of the concept.

The Hungarian Energy Strategy was adopted by the Parliament in October 2011. The Energy Strategy gives a roadmap until 2030 and it has a vision until 2050. The main aim of the strategy is to ensure the optimal balance of security of supply, competitiveness and sustainability. The energy imports should be decreased by diversification of resources and/or origins. The main elements of the strategy include the increased use of renewables, maintenance of nuclear capacity (lifetime extension and consideration of building new capacity), development of regional energy infrastructure, development of a new organizational system as well as increased effectiveness and efficiency in energy use. The National Energy Strategy can be found on the web site of the Ministry of National Development (http://www.kormany.hu/en/ministry-of-national-development). For more information see Section 2.3.1. According to government policy, energy price cuts reached 20% in 2014 for individual customers.

According to the National Policy for the Management of Spent Fuel and Radioactive Waste adopted in April 2015 by the Parliament and National Programme for the Management of Spent Fuel and Radioactive Waste approved by the Government in 2016, the national development goals and objectives relating to spent nuclear fuel and radioactive waste are: development of a national strategy for the back end of the fuel cycle with due consideration to be given to various options; continuous extension of the Spent Fuel Interim Storage Facility in Paks; phased implementation of the geological investigation programme of the Boda Claystone Formation aiming at a future deep geological repository; ongoing implementation of the safety enhancement programme at the Radioactive Waste Treatment and Disposal Facility in Püspökszilágy as well as the extension of the National Radioactive Waste Repository in Bátaapáti and optimization of its disposal concept.

The Act on Atomic Energy (Act CXVI of 1996) was modified to a great extent in 2011. The most important elements of the modification concerned the safety principles and the tasks and activity of the Hungarian Atomic Energy Authority (HAEA). The nuclear safety codes have also been modified, with the WENRA reference levels built in. The set of requirements was completed by two new volumes in order to define requirements for all parts of the lifetime of nuclear facilities. The new set of requirements came into force on 1 November 2011.

A modification of the Act in 2013 declares that in all facility level licensing procedures the HAEA shall arrange public hearings to ensure transparency and openness.

Furthermore from 1 July 2014 the responsibilities of the HAEA have undergone several changes. According to this amendment HAEA took over the task of regulatory oversight of the radioactive waste repositories. The Act also introduced new procedures regarding licences for site assessment and evaluation, and licences to define characteristics and to determine the suitability of the site.

The Hungarian Parliament approved Act VII of 2015 on the modification of the regulations involving the construction of new nuclear power plant units (the “Project” Act). The Project Act amended the Act on Atomic Energy in several sections. The new provisions (inter alia) extend the responsibility of the HAEA over the supervision of application of ionizing radiation as well as over radioactive waste repositories, and guarantee that the revenues of the HAEA can only be used for regulatory purposes. The Project Act furthermore transfers the responsibilities to HAEA for radiation protection (safety of radioactive sources, safety of equipment emitting ionizing radiation without radioactive material), personal dose monitoring, environmental monitoring, construction of general civil structures and buildings of nuclear facilities and radioactive waste repositories as of 1 January 2016. Lower level legislative amendments also entered into force on 1 January 2016.

From 1 January 2016, HAEA is the general construction supervisory authority for construction in the safety zone of nuclear installations and radioactive waste depositories. (HAEA was responsible for the supervision of special nuclear construction exclusively.) The latest amendments are to enter into force on 1 January 2017.

The modified Act and the new safety codes can be found on the HAEA’s web site (www.haea.gov.hu).

After the accident at the Fukushima Daiichi Nuclear Power Plant (NPP), all European countries operating NPPs performed the Targeted Safety Reassessment (TSR) — the so-called stress test — to meet the request of the European Council. The TSR of Paks NPP focused on topics specified by the ENSREG (the issues corresponding to earthquake and/or flooding and other external natural hazard factors, to the loss of electric power supply and loss of ultimate heat sink or a combination of those, and to severe accident management). In relation to the hazard factors it was assessed whether the design basis of the plant was duly determined and whether there were sufficient reserves beyond design basis before severe damage occurred. Based on the final report of the Paks NPP submitted to the HAEA for regulatory review, the HAEA agreed with the proposed tasks in the report to be carried out in order to further improve the plant safety and identified a few additional options. Along with the detailed coverage of the topics specified by ENSREG, HAEA also established that the national legal requirements for the safety of NPPs are in line with the international standards and best practices. HAEA submitted the National Report about the results of the review to the European Commission by the end of 2011 and published it on its web site (www.haea.gov.hu). Based on the results of the regulatory review of the TSR, HAEA concluded that the design basis of Paks NPP is adequate, and complies with the legal requirements and international practice. The safety systems and safety functions satisfy requirements of the design basis. After the last Periodic Safety Review of Paks NPP, specific safety enhancement measures were implemented, mainly in order to improve the plant’s beyond design basis capabilities. These measures are fully in line with expectations of the TSR as well. It can be concluded that Paks NPP is safe and no deficiency has occurred. The measures initiated by the last Periodic Safety Review provide robust capabilities for the plant for successful management of severe situations as well. In addition to the positive findings, the TSR identified a number of options and measures to enhance plant safety even further. The HAEA ordered the operator of the plant to develop the detailed programme by the end of the first half of 2012 in order to realize these options.

The National Action Plan of Hungary on the implementation actions decided upon the lessons learned from the Fukushima Daiichi accident was adopted in December 2012. The National Action Plan has been prepared in accordance with the recommendations of ENSREG (see ENSREG web site). The implementation of the National Action Plan is currently in progress.

As of 31 December 2016, the status of the National Action Plan at the Paks NPP on the implementation actions decided upon the lessons learned from the Fukushima Daiichi accident is the following: out of 46 tasks, 33 are ready and closed by the HAEA, 1 is ready and under review by the HAEA, and 12 tasks are still ongoing.

TABLE 1. ESTIMATED AVAILABLE ENERGY SOURCES

	Estimated available (exploitable) energy sources
	Fossil fuels			Nuclear	Renewables
	Solid	Liquid	Gas	Uranium	Hydro	Other renewable
Total amount in specific units*	8 413.7	66.9	1 675.3	26.8
Total amount in exajoule (EJ)					0.016	60.110

* Solid, Liquid: Million tons; Gas: Billion m³; Uranium: Metric tons; Hydro, Renewable: EJ.

Source: Hungarian Office for Mining and Geology.

Hungary has estimated coal reserves of more than 10.5 billion tonnes. The bulk of this is lignite, with 5.7 billion tonnes, followed by 3.1 billion tonnes of brown coal and 1.6 billion tonnes of hard coal. The coal found in Hungary has comparatively low calorific value with high ash and sulphur content. Only lignite deposits in the north-east region of Hungary could profitably be mined. An important element of coal mining is the rigorous application of environmental protection requirements. Although the major share is used for power generation, a significant amount of coal was used for heating and cooking in households and communal facilities until the early 1990s; since then, the use of coal has rapidly declined. Domestic production of coal has also declined in the last two decades. Hungary produced about 9 263 Mt of coal in 2015, and imports are needed. The imports come mostly from the Czech Republic, Poland and the Russian Federation. Hungary’s oil and gas reserves are relatively small. Hungary’s uranium resources are limited to those of the Mecsek deposit. Between 1956 and 1997, uranium was mined at the underground Mecsek mine by the Mecsek Ore Mining Company, producing a total of just over 21 000 tU (tonnes of uranium metal). Until an ore processing plant became operational at the site in 1963, all ore was shipped to the Sillimae metallurgy plant in Estonia. After 1963, uranium concentrates produced at the processing plant were shipped to the Soviet Union. The mine was closed in 1997 due to poor market conditions. Remediation activities began the following year and were completed in 2008. Ongoing treatment of contaminated water from the mine and tailings ponds results in the collection of about 1 to 3 tU per year.

The MECSEKÉRC Environmental Protection Public Limited Company was established as a state owned company continuing the State mine remediation tasks. This company undertakes environmental protection, geoscience, technical and geotechnical jobs in the following fields:

Design and implementation of repositories to be developed with mining techniques (e.g. prospecting for low and intermediate level radioactive waste repositories, gas or LPG storage facilities, pumping energy accumulator power plants);

1. Prospecting and preparation of interim or final disposal of radioactive and hazardous waste, and the construction of facilities for these purposes;

2. Planning and fulfillment of the remediation activity for the uranium industry in central European countries;

3. Full-scale remediation and land reclamation activity to wind up consequences of former mining and other environment harming activities;

4. Soil mechanical test, control and design of earthworks;

5. Environmental damage assessment;

6. Planning, implementing and licensing of environmental damage remediation activities;

7. Geological, hydrogeological and mineral resource prospecting;

8. Geological, hydrogeological and soil mechanical planning and carriage tasks related to infrastructure investments (e.g. road and railway construction);

9. Testing, planning and carriage work for protecting and securing drinking water resources;

10. Surface and underground solid mineral mining activity, obtaining mining licences.

TABLE 2. ENERGY STATISTICS (EXAJOULE)

	1990	2000	2007	2008	2009	2010	2011	2012	2013	2014	2015	2016	Average annual growth rate (%)
Energy consumption**
- Total	1.204	1.055	1.125	1.126	1.056	1.120	1.096	1.041	1.007	1.005	1.063	1.078	-0.635
- Solids***	—	0.160	0.131	0.127	0.106	0.114	0.113	0.108	0.094	0.092	0.099	0.093	-3.336
- Liquids	—	0.330	0.315	0.304	0.292	0.284	0.270	0.253	0.245	0.275	0.294	0.302	1.029
- Gases	—	0.377	0.448	0.442	0.383	0.411	0.392	0.351	0.322	0.292	0.314	0.336	-3.302
- Nuclear (electricity)	—	0.141	0.161	0.162	0.169	0.172	0.172	0.173	0.168	0.172	0.174	0.176	0.384
- Hydro (electricity)	—	0.001	0.001	0.001	0.001	0.001	0.001	0.001	0.001	0.001	0.001	0.001	0.000
- Wind (electricity)		0.000	0.001	0.001	0.002	0.002	0.002	0.003	0.003	0.002	0.002	0.002	0.000
- Primary electricity (net import)		0.010	0.014	0.014	0.020	0.019	0.024	0.029	0.043	0.048	0.049	0.046	15.878
- Other renewables	—	0.033	0.055	0.068	0.078	0.117	0.122	0.124	0.131	0.122	0.130	0.122	0.700
Energy production
- Total	0.634	0.485	0.427	0.436	0.458	0.497	0.493	0.492	0.480	0.464	0.473	0.472	-0.856
- Solids***	—	0.121	0.074	0.071	0.065	0.067	0.069	0.067	0.067	0.066	0.064	0.061	-1.551
- Liquids	—	0.070	0.050	0.052	0.051	0.046	0.041	0.043	0.037	0.035	0.036	0.040	-2.302
- Gases	—	0.104	0.084	0.084	0.096	0.094	0.089	0.074	0.065	0.060	0.057	0.060	-7.209
- Nuclear	—	0.155	0.161	0.162	0.169	0.172	0.172	0.173	0.168	0.172	0.174	0.176	0.384
- Hydro	—	0.001	0.001	0.001	0.001	0.001	0.001	0.001	0.001	0.001	0.001	0.001	0.000
- Wind	—	—	0.000	0.001	0.002	0.002	0.002	0.003	0.003	0.002	0.002	0.002	0.000
- Other renewables and wastes	—	0.035	0.054	0.069	0.079	0.116	0.120	0.131	0.140	0.127	0.139	0.132	2.177
Net import (Import - Export)
- Total	0.570	0.570	0.691	0.711	0.622	0.633	0.547	0.519	0.501	0.594	0.569	0.606	-0.724
Stock changes (Opening - Closing stock)
- Total			0.008	0.031	0.033	-0.01	0.055	0.03	0.026	-0.055	0.022	-0.000	-31.871

* Latest available data.

** Energy consumption = Primary energy production + Net import (Import - Export) of secondary energy + stock change.

*** Solid fuels include coal, lignite.

Source: Hungarian Energy and Public Utility Regulatory Authority, Directorate of Analysis and Statistics.

The reform of the electricity industry started in 1994–1995, when Act XLVIII of 1994 on Production, Transportation and Supply of Electricity was developed and came into force. The Hungarian Energy Office (at present: Hungarian Energy and Public Utility Regulatory Authority) was established in 1994. The privatization of the electricity sector took place in several phases. At present, the majority of power stations and 100% of the electricity suppliers (the grid and the distributors) are privately owned.

In Hungary, the electricity policy is an integrated part of the energy policy. The most important document upon which the Hungarian electricity market liberalization was founded was entitled “Principles of Hungarian Energy Policy and a New Business Model”. It was adopted by the Government in 1999 (Government Resolution 2199/1999).

Hungary became a member-state of the European Union in 2004 and that required further harmonization of the Hungarian legal framework with European Union legislation. An important step of the harmonization was the adoption of a new Act on Electricity (Act LXXXVI of 2007) which was adopted by the Parliament in 2007. The harmonization and electricity policy objectives were reflected in the Act. The aim of the Act is the effective operation of the competitive electricity market. Access to the electricity grid is guaranteed at regulated prices. Transmission, distribution and system operation tariffs are set and published by the Minister of National Development. New capacities are established on a commercial basis through an authorization process. The new Act regulates the rules of full market opening, which entered into force in 2008.

The energy market was fully opened on 1 January 2008. To supply vulnerable consumers, universal service supplier licences were issued in addition to the licence types previously in use. In parallel with the abolition of public utility supply, the licence for public utility wholesale was also abolished. The European Commission investigated the compatibility of long term contracts (which aimed to prepare the privatization in the single buyer model) with the competitive market. In decision No. C-41/2005, published on 4 June 2008, the Committee stated that the contracts implied prohibited state subsidy and ordered they be terminated and the prohibited state subsidy repaid. Thereby, the system of long term contracts ceased to be in force at the end of 2008. Due to the lack of generation sources in the region and the high oil prices, the full market opening resulted in an unexpected price rise on the domestic market. The Electricity Act was again amended in June 2008 to ensure an “intervention possibility” in determining the prices. Based thereon and after identifying the participants with considerable market power, the Hungarian Energy and Public Utility Regulatory Authority ordered MVM Trade Ltd. and GTER Ltd. to apply electricity price caps. The universal service category includes the household consumers and (former public utility) low voltage consumers with nominal current not greater than 3×63 A. In this circle, authority (regulated) pricing continues to exist. The competitive market consumers have to purchase the power from the traders and have to sign a network use contract with the network licence holder competent in the relevant area. Authority pricing now concerns only the system use charges; the prices of electricity traders are set by the competitive market. However, network access is ensured for each market participant. In connection with residential consumers (eligible for universal service), on 15 December 2012 the Ministry of National Development issued a decree stipulating price reductions in electricity (a cut of 10%) as of 1 January 2013. Further price cuts were introduced in 2013 and 2014 as well, reducing the tariffs by 26% altogether.The relevant laws are available on the web site of the Hungarian Energy and Public Utility Regulatory Authority (www.mekh.hu).

The responsibility for providing a reliable, efficient and environmentally friendly energy supply for Hungary belongs to the Ministry of National Development (www.nfm.gov.hu), established in 2010. Directly under the top political level, energy issues are handled by the Minister of State for Energy Affairs. Development, competitiveness, security and sustainability are the key words directing the activity of the ministry.

The Hungarian Energy and Public Utility Regulatory Authority (MEKH) (www.mekh.hu) is currently responsible for licensing energy suppliers, supervising the balance of demand and production as well as the standards of service provision, and protecting consumer interests. Pursuant to Section XIX of the Act on Electricity (Act LXXXVI of 2007), the Hungarian Energy and Public Utility Regulatory Authority is an independent governmental office with separate and independent financial management. The MEKH is self-financing. Licencees are charged a supervisory and administration fee for their activities. Following a proposal by the Ministry of National Development, the Prime Minister appoints and relieves the MEKH president. MEKH resolutions can only be appealed and amended in court. The goal of MEKH is to ensure market operation, to promote competition and to implement the efficiency requirements and principle of least cost, to sustain and improve security of supply and to protect the interests of users and licence holders as well as to regulate prices in order to guarantee fair competition.

The Ministry for Agriculture (FM — http://www.kormany.hu/hu/foldmuvelesugyi-miniszterium) is responsible for environmental issues. The task of the State Secretariat for Environmental Affairs within the Ministry is promotion of sustainable development, the preservation of air, water and soil quality and the protection of natural assets. In the area of waste management, the Ministry has the aim of reducing pollution and facilitating recycling and up to date treatment of waste.

According to the legislation in force, the approval of the Government or the Parliament is needed for the establishment of power plants above 200 MW capacity. Between 200 and 600 MW capacity, it is the right of the Government to give the approval, while above 600 MW capacity, the Parliament has to approve it. Any nuclear installation, including power and research reactors, should be approved by the Parliament independently of its capacity. In 2009 the Parliament authorized the government to start preparations for new nuclear units to be built at the Paks site.

In the last decade, Hungary made substantial progress in restructuring its electricity sector and creating a market oriented, fully European Union conforming regulatory framework. Today, the power industry is restructured and mainly privatized.

Figure 1 shows the simplified model of the Hungarian electricity industry.

FIG. 1. Hungarian electricity industry.

MVM Hungarian Electricity Ltd.

MVM Hungarian Electricity Ltd. (http://mvm.hu/?lang=en) is a competitive strategic holding company and nationally owned corporate group. MVM Group is an integrated player in the domestic electricity and gas market, and it is also active in the electricity and gas industry in the region. The holding company led by MVM Ltd. has been operating as a “Recognized Corporate Group” as of 1 June 2007. The group realized an EBITDA of HUF 110 billion and a profit after tax of HUF 48 billion against sales of HUF 1 034 billion in 2016.

The integrated structure of the Group, reflecting an organizational structure widespread in Europe and conforming to the norms of the European Union, provides a proper background for the fulfilment of its diverse tasks and for the developments which are necessary in the power system.

The strategic target of MVM to 2020 is to double its EBITDA by retaining its existing positions and accessing new growth areas through:

Achieving operational excellence to increase competitiveness;

• Partnership in providing energy security;

• Integrating the value chain to optimize the value chain and presence in growth areas;

• Increasing presence in renewable energy production;

• Innovating and providing energy related services;

• Expanding in the region.

Currently, the group controls one of the most important sectors of the national economy, the domestic electricity supply. The activities include electricity generation, transmission system operation and electricity trade (wholesale).

MVM is also taking a key role in the natural gas market. Currently the group is present in all key areas of the business, namely natural gas storage, wholesale and trading.

The key assets/companies of the group include Paks nuclear power plant (2000 MW installed capacity), open cycle gas turbines (526 MW installed capacity), CHPs (114 MW installed capacity), renewable generation units (23 MW wind, 10 MW solar), MAVIR (Hungarian Transmission Operartor), Hungarian Gas Storage Ltd. (4.43 bcm storage capacity) and the electricity and gas wholesalers (Hungarian Gas Trade Ltd. and MVM Partner Ltd).

In order to prepare the planned new units, MVM established its new project company, MVM Paks II. Nuclear Power Plant Development Ltd. (MVM Paks II. Ltd. or project company) in 2012. Due to change of ownership in November 2014 (with the aim of shortening the decision making mechanism), the project company MVM Paks II. Ltd. does not belong to the MVM Group anymore. It came under direct state control starting when the Prime Minister’s Office obtained the owner’s rights and until the end of 2026.

FIG. 2. The structure of the MVM Group.

The installed capacity of domestic power plants on 31 December 2016 was 8 339 MW_e. Compared to the value of 31 December 2015 (8 453), it decreased slightly by 114 MW_e. The peak load of the Hungarian electricity system was 6 749 MW in 2016, which means an increase of 292 MW compared to 2015 (6 457 MW). Though the increase in energy efficiency may help reduce the rate of increase of primary energy consumption, it is still expected that the electricity demand will increase after overcoming the world crisis. The peak demand will increase between 700 and 1 300 MW by 2031. Taking into account the necessary shutdown of old fossil power plants, new generation capacity of between 4 500 and 5 100 MW is needed by 2031.

The generation mix of the Hungarian electricity system is presently well balanced, with about 17% gas, 52% nuclear, 19% coal and an increasing ratio of renewables. The electricity production from renewable energy sources is growing in accordance with the European Union directive on green electricity. In 2015, renewable based electricity production made up a share of 7.3% of total electricity production.

The Hungarian energy supply is around 60% import dependent; therefore its security is a crucial priority of the National Energy Strategy. The safe, successful and profitable operation of the state owned Paks NPP greatly contributes to meeting this challenge. The obligatory stockpiling of nuclear fuel for two years is also an essential element in ensuring the stability of supply in case of any disturbances in imports.

Companies operating power plants of 50 MW or higher capacity:

Tisza Eromu Kft.	http://tiszapower.eu/
Alpiq Csepel Kft.	http://csepel.alpiq.hu
Bakonyi Eromu Ltd.	www.bakonyi.hu
Budapesti Eromu Ltd.	www.bert.hu
Debreceni Kombinált Ciklusú Eromu Kft.	www.veolia.hu
Dunamenti Eromu Ltd.	www.dert.hu
E.ON Eromuvek Kft.	www.eon-hungaria.com
ISD-Power Ltd.	www.isdpower.hu
MVM GTER Gázturbinás Eromu Ltd.	www.gter.hu
Mátrai Eromu Ltd.	www.mert.hu
MVM Paksi Atomeromu Ltd.	www.npp.hu
PANNON Hoeromu Ltd.	www.pannonpower.hu
Vértesi Eromu Ltd.	www.vert.hu

There are a further 200 companies, operating more than 300 (small) power plants under 50 MW capacity.

Transmission operator

MAVIR Ltd.

www.mavir.hu

In Hungary, high voltage electricity is transmitted on a single common transmission line network, which is owned and operated by the Hungarian Transmission System Operator, MAVIR Ltd. This oranization is, at the same time, a member of the MVM Group. The Transmission System Operator operates according to the ITO (Independent Transmission Operator) model: it operates independently of the other economic operators that use the transmission network, and its independence is prescribed by legislation. In accordance with the relevant statutory regulations, MAVIR Ltd., as an organization independent of other participants in the electricity system, is responsible for ensuring a secure energy supply.

Electricity distribution

There are six regional distribution companies responsible for operation of networks with a voltage of 120 kV and below, as well as supply for the customers.

E.ON Észak-dunántúli Áramszolgáltató Ltd.
DÉMÁSZ Hálózati Elosztó Ltd.	www.demasz.hu
E.ON Dél-dunántúli Áramszolgáltató Ltd.
E.ON Tiszántúli Áramszolgáltató Ltd.
ELMÜ Hálózati Ltd.	www.elmu.hu
ÉMÁSZ Hálózati Ltd.	www.emasz.hu

TABLE 3. ELECTRICITY PRODUCTION, CONSUMPTION AND CAPACITY

													Average annual growth rate (%)
	1970	1980	1990	2000	2005	2010	2011	2012	2013	2014	2015	2016
Capacity of electrical plants (GWe)
- Thermal**			5.36	6.32	6.35	6.13	6.76	6.73	6.70	5.643	5.51	5.592	1.5%
- Hydro			0.05	0.05	0.05	0.05	0.06	0.06	0.06	0.057	0.057	0.058	1.8%
- Nuclear			1.76	1.85	1.87	2	2	2	2	2	2	2	0%
- Wind			0	0	0.02	0.29	0.33	0.33	0.36	0.329	0.329	0.329	0%
- Geothermal			0	0	0	0	0	0	0	0	0.000	0	0%
- Other renewable***			0.01	0.02	0.36	0.52	0.5	0.29	0.3	0.626	0.684	0.686	0.4%
- Total	2.48	4.98	7.18	8.29	8.6	8.99	9.65	9.41	9.40	8.655	8.579	8.665	1%
Electricity production (TWh)
- Thermal**			14.51	20.77	20.05	18.59	17.63	16.19	12.14	10.60	11.30	12.5	10.8%
- Hydro			0.18	0.18	0.2	0.19	0.22	0.21	0.21	0.30	0.23	0.26	10.3%
- Nuclear			13.73	14.18	13.83	15.76	15.69	15.79	15.37	15.65	15.83	16.05	1.4%
- Wind			0	0	0.01	0.53	0.63	0.77	0.72	0.66	0.69	0.68	-1.3%
- Geothermal			0	0	0	—	—	—	—	—
- Other renewable***			0.02	0.07	1.66	2.30	1.86	1.66	1.86	2.18	2.28	2.22	-2.7%
- Total1	14.5	23.9	28.44	35.2	35.75	37.37	36.02	34.63	30.29	29.39	30.34	31.73	4.6%
Total electricity consumption (TWh)****	17.94	31.3	39.58	38.63	41.98	42.57	42.63	42.55	42.2	42.15	43.98	44.44	0.1%

¹ Electricity transmission losses are not deducted.

* Latest available data.

** Only fossil fuel, and non renewable municipal waste and industrial waste.

*** Renewable combustible fuel; solar.

**** Gross production + imp - export.

Sources: Hungarian Power Companies Ltd.Hungarian Energy and Public Utility Regulatory Authority (only data for 2014, 2015, 2016).

TABLE 4. ENERGY RELATED RATIOS

	1990	2000	2009	2010	2013	2014	2015	2016
Energy consumption per capita (GJ/capita)	116	103	106	112	102	102	108	109
Electricity consumption per capita (kWh/capita)	3.817	3.78	4.13	4.3	4.3	4.4	4.5	4.5
Electricity production/Energy production (%)	14.4	27.0	34.1	27.1	22.7	22.8	23.1	24.2
Nuclear/Total electricity (%)	48.1	40.3	43.0	42.2	50.7	53.2	52.2	50.6
Ratio of external dependency (%) 1	47.34	54.0	62.0	56.5	49.7	59.3	53.5	56.2

¹ Net import / Total energy consumption.

* Latest available data

Source: Hungarian Statistical Office.

The first Hungarian reactor was built for research purposes at Csillebérc, on the outskirts of Budapest in 1959. The reactor, of Soviet origin and refurbished by Hungarian experts after 30 years of operation, was put into operation again by the Atomic Energy Research Institute in 1993. The Budapest Research Reactor is a tank type reactor with 10 MWth power and is operated by the Centre for Energy Research of HAS.

The Training Reactor of the Institute of Nuclear Techniques (NTI) of the Budapest University of Technology and Economics (BME) was put into operation in 1971. Since then, the training reactor has been used mainly for the purposes of education in the nuclear field. It is a pool type reactor with 100 kWth power.

In 1966, it was decided to construct a NPP in Hungary. The decision included two WWER-440 type, 230 model reactors. The construction work started in 1968, but it was interrupted in 1970 because, at that time, oil fired stations were considered to be more economical. The actual construction work started after the oil crisis in 1975. The final decision included four second generation reactors, i.e. WWER-440/213, instead of the two 230 model reactors, all to be part of one NPP. The plant is located about 5 km south of the town Paks, on the right bank of the river Danube. Since 1987, these four reactors have been generating electricity for the Hungarian electric energy system. The original installed capacity of the reactors was 4 times 440 MWe. Earlier upgrades of the secondary circuit and turbine resulted in an uprated 470 MWe, with an unchanged thermal capacity at all four units. An upgrade of the primary side was decided, to increase the nominal power by 8% to 1485 MWth, resulting in about 500 MWe generated power per unit. The power uprate was completed in 2009. Based on the application of the operator, HAEA granted 20 years service life extention for Unit 1, Unit 2 and Unit 3. In November 2016 the NPP submitted its request for authorization of the lifetime extension of Unit 4.

Hungary’s national policy concerning the application of atomic energy is regulated by law. The basic purposes of Act CXVI of 1996 are those of protecting the health and safety of the population and protecting the environment. The requirements of the Act state that the use of atomic energy is allowed only in a manner provided by law and under the permanent control of the competent authority. Regardless of what aspect of atomic energy is being considered, safety is a priority.

Licensees

MVM Paks Nuclear Power Plant Ltd. (www.npp.hu) — Has four WWER-440/213 type power reactors.

MVM Paks II. Nuclear Power Plant Development Ltd. (http://www.mvmpaks2.hu) — The goal of the Company is to continue performing at a high professional standard the tasks involved in the preparation of the establishment of new nuclear power plant units.

Public Limited Company for Radioactive Waste Management (PURAM) (http://www.rhk.hu/en) — Operates the Spent Fuel Interim Storage Facility at Paks and the Radioactive Waste Treatment and Disposal Facility at Püspökszilágy that manages low and intermediate level waste generated by medical, industrial and research applications. It also operates the National Radioactive Waste Repository in Bátaapáti dealing with low and intermediate level waste generated in the Paks NPP. PURAM is investigating the Boda Claystone Formation in west Mecsek to select a site for high level and long lived radioactive waste.

Hungarian Academy of Sciences Centre for Energy Research (www.energia.mta.hu) — Operates the Budapest Research Reactor.

Institute of Nuclear Techniques of the Budapest University of Technology and Economics (www.reak.bme.hu) — Operates the BME Training Reactor.

Governmental Organizations with Responsibility in Nuclear Field

The Hungarian Atomic Energy Authority (HAEA) (www.haea.gov.hu) is a public administration body acting in the field of peaceful applications of atomic energy with a specified scope of tasks and authority, and is independent from both the organizational and financial points of view. Establishing the regulatory duties in connection with the safety of the peaceful application of nuclear energy, particularly with the safety of nuclear facilities under normal and accident conditions and with nuclear emergencies, is a basic task of the HAEA. In addition, the HAEA is required to harmonize and handle the related public information activities. Acting independently and supervised by a minister appointed by the Prime Minister, the HAEA is primarily concerned with ensuring nuclear safety in accordance with the law. From 2010, the Minister of National Development is responsible for the supervision of the HAEA’s activity. The Director General of the HAEA is appointed and relieved by the Prime Minister. The HAEA resolutions can only be appealed and amended in court.

The Ministry of Human Capacities undertakes the tasks of the authority regarding issues related to radiation protection during medical irradiation.

Within the Ministry of Agriculture, the State Secretariat for Environmental Affairs, Agricultural Development and Trademarks is responsible for establishing air and water quality standards, limits on radioactive releases from nuclear facilities, as well as for controlling the emissions at the facilities to the environment.

Research Institutes

The HAS Centre for Energy Research was established in January 2012 from two former independent institutions, the Institute of Isotopes and the KFKI Atomic Energy Research Institute. The Institute of Technical Physics and Material Science (MFA) joined the centre on 1 January 2015. The Centre is part of the a research network of the Hungarian Academy of Sciences (HAS). The website of the new organization can be found at www.energia.mta.hu.

The center operates the 10 MWth Budapest Research Reactor. It is active in several fields of nuclear technology, such as reactor physics, thermal hydraulics, health physics, simulator techniques and reactor chemistry. It performs a wide variety of research related to the use of radioactive materials and nuclear techniques, among them a research and development programme for nuclear safeguards. It provides the expert support and the laboratory equipment for the HAEA.

The Institute of Nuclear Research (ATOMKI, Debrecen) of the Hungarian Academy of Sciences operates a 20 MeV cyclotron and a 5 MeV Van de Graaff accelerator, and is active on several fields of nuclear physics and nuclear techniques (www.atomki.hu).

The National Research Institute for Radiobiology and Radiohygiene (OSSKI, Budapest) performs a wide spectrum of research including on the biological effects of radiation and radioisotopes, radiohygiene (operational and environmental), sterilization, detoxification, etc. As of 3 April 2015 the Institute merged with National Public Health Centre (Országos Közegészségügyi Központ) (www.osski.hu).

The Nuclear Research Safety Institute (NUBIKI, Budapest) carries out safety analysis and risk assessment of nuclear power plants including level 1 and 2 PSA and severe accident analysis (www.nubiki.hu).

The Institute of Nuclear Techniques of the Budapest University of Technology and Economics (BME NTI) operates a training reactor, teaches nuclear technology for engineers, physicists, chemists and environmentalists, and performs research in different nuclear related topics (www.reak.bme.hu).

The Power Engineering and Contractor Co., Poyri Eroterv Co. (before 2010: ETV-EROTERV Co., Budapest) works in the fields of design, construction, commissioning and operating management of nuclear facilities. Its activities include waste management (treatment, storage and disposal) (http://www.poyry.hu/).

The Institute of Experimental Physics of the University of Debrecen operates the Laboratory for Nuclear Safety and Techniques, NUBITEL (http://falcon.phys.klte.hu/kisfiz/) and the Quantechnologies Research and Development Co. (http://www.quantec.hu/). The following main fields represent their areas of operation: in-situ alpha, beta and gamma activity measurements in NPPs (primary circuit and refueling, storage and technical ponds); exploration and handling of nuclear waste; detection of radioactivity in the environment (NORM/TENORM), underwater gamma spectrometry; data evaluation and trend analysis; and education and training in applied nuclear physics.

1. The Department of Nuclear Medicine of the University of Debrecen (DE NMI) (http://www.pet.dote.hu/) operates a GE PETtrace cyclotron and a radiochemistry center, and develops and produces positron labeled radiopharmaceuticals for medical and research purposes. The department takes part in various IAEA training programmes.

The Institute of Radiochemistry and Radioecology at the University of Pannonia has a wide range of topics in research and education in two main fields: radiochemistry and nuclear technology, as well as radioecology and radiation protection (http://radio.mk.uni-pannon.hu/).

Taking into account the energy situation in Hungary, the operation of the only NPP is crucial. The design lifetime of the WWER-440/213 Units at Paks is 30 years; the operating licence is formally limited in time by the planned operational lifetime. As in other countries, the current Hungarian legislation for nuclear energy allows the renewal of the operating licence, if the safety of the continuation of the operation can be demonstrated, and the renewal is approved by the responsible authorities.

TABLE 5. STATUS AND PERFORMANCE OF NUCLEAR POWER PLANTS

Reactor Unit	Type	Net Capacity [MW(e)]	Status	Operator	Reactor Supplier	Construction Date	First Criticality Date	First Grid Date	Commercial Date	Shutdown Date	UCF for 2016
PAKS-1	PWR	470	Operational	PAKS Zrt	AEE	1974-08-01	1982-12-14	1982-12-28	1983-08-10		90.8
PAKS-2	PWR	473	Operational	PAKS Zrt	AEE	1974-08-01	1984-08-26	1984-09-06	1984-11-14		80.2
PAKS-3	PWR	473	Operational	PAKS Zrt	AEE	1979-10-01	1986-09-15	1986-09-28	1986-12-01		100.0
PAKS-4	PWR	473	Operational	PAKS Zrt	AEE	1979-10-01	1987-08-09	1987-08-16	1987-11-01		92.7

Data source: IAEA - Power Reactor Information System (PRIS).

Note: Table 7 is completely generated from PRIS data to reflect the latest available information and may be more up to date than the text of the report.

Data source: IAEA — Power Reactor Information System.

There are no NPP suppliers in the country; the main components of the Paks NPP were made abroad (i.e. in Russian Federation and the Czech Republic). The main constructor was AEE (Atomenergoexport) and the main architect ERBE-EROTERV (Hungary). The manufacture of many components of the Russian Federation-designed WWERs was done in the former COMECON countries under a multilateral agreement.

The Paks NPP generated 16 054 GWh of electric energy in 2016, which represents 51.3% of the gross domestic electricity production of Hungary. This amount was generated by four units as follows: Unit 1: 4 028 GWh; Unit 2: 3 576.3 GWh; Unit 3: 4 403.8 GWh; Unit 4: 4 045.8 GWh. As far as the amount of the energy produced, 2016 provided the largest production result in the history of the power plant. The amount of electricity that has been generated by Paks NPP since the date of the first connection of Unit 1 to the grid was higher than 445.5 TWh as of the end of 2016.

FIG. 3. Map of Hungary indicating the location of Paks NPP.

The Paks NPP consists of four WWER-440/213 type reactor units, originally designed to produce 1375 MWth and 440 MWe each. Earlier upgrades of the secondary circuit and turbine increased the electrical output to about 470 MWe in each unit, with no change to thermal capacity. Recently, an upgrade of the primary side was completed that increased the nominal power by 8% to 1485 MWth, resulting in about 500 MWe of power generation by each unit. The power increase is primarily reached by refined primary pressure regulation, a core control system upgrade and the use of a new type of fuel assembly. Additional modifications have been performed in certain technological components, e.g. replacing some of the MCP impellers and decreasing the initiating pressure value of the hydraulic accumulators. By the end of 2009, the uprating process was completed successfully on all four units, and 2010 was the first year they operated at the increased power level.

In order to enhance its economic and operational efficiency and to improve its position in the market, the Paks NPP began an Economical Efficiency Enhancement Programme (EEP), the principal elements of which are enhancing human resource efficiency, power uprating, optimizing maintenance and initiating service life extension.

At the end of 2008, Paks NPP submitted a lifetime extension programme to HAEA to justify the establishment of the operating conditions and safe operation beyond the design lifetime. HAEA evaluated the programme and ordered the licensee to implement the programme with certain conditions. The technical preparation activities covered the determination of the ageing effects and ageing processes requiring treatment, the status of the systems, structures and components, the evaluation of the existing ageing management programmes, and if necessary, the amendment or development of new programmes. HAEA regularly reviews and evaluates the progress reports of the lifetime extension programme. In December 2011, in compliance with the legal requirements, Paks NPP submitted the beyond design lifetime licence application for Unit 1, one year before the expiration of its licensed operating time. By the end of 2012, HAEA evaluated the licence application and the additional information and made a decision on the extension. On the basis of the review of the approximately 30 000 page long licence application, the HAEA stated that nuclear safety requirements were fulfilled and safe operation was ensured. The HAEA granted the operating licence for Units 1 and 2 for the next 20 years, subject to the periodic safety assessment of the unit. In November 2015, Paks NPP submitted the beyond design lifetime licence application for Unit 3, and obtained the licence in December 2016. In November 2016, the NPP submitted its request about the authorization of the lifetime extension for Unit 4.

In December 2015, the HAEA issued a licence to introduce a 15 month operation interval at Units 1–4 of Paks NPP, and as a preliminary measure, to implement a new type of fuel assembly with the mean enrichment of 4.7%.

The construction of new units at the Paks site was proposed in order to meet future electricity demand.

Under Hungary’s Act on Atomic Energy, the government needs to obtain a decision in principle from the Parliament in order to start any preparatory activity that could lead to the construction of a new nuclear installation. On 30 March 2009, members of the Hungarian Parliament gave their decision in principle with more than 90% of the votes in support of it.

After this, the preparation for the construction of the new units commenced. The activities included preparations for obtaining environmental and site licences. A survey was also initiated to determine the possible suppliers for the construction of the new units and the demand for the necessary labour.

In 2012, the Board of the MVM Ltd. took a decision to establish a company to continue the tasks. The company is called MVM Paks II. Nuclear Power Plant Development Ltd. (MVM Paks II. Ltd.). The tasks of the MVM Paks II. Ltd. include the examination of all essential aspects of the construction in order to prepare the project for further decision making procedures on the construction of the new units at the Paks site.

Update of the Nuclear Safety Regulation

The HAEA started preparations for the licensing of the new units by reviewing four important areas: regulatory requirements, the licensing framework, technological and safety characteristics of possible new units and the international framework. The most important goal of HAEA is to adopt the strictest requirements set by the latest findings of science and technology. As part of the review process, the representatives of the nuclear industry, the HAEA and the Hungarian National Standard Committee agreed on the promulgation of a series of international standards specific to NPPs to cover the necessary technical fields on which Hungarian National Standards were not available. The first series of standards covering the principles of instrumentation, control room and emergency control room design, display of safety parameters, detection of leakages and loose parts in the primary circuit, neutron flux monitoring, radiation monitoring and alarming were published as Hungarian National Standards in January 2011.

According to the Act on Atomic Energy, the safety requirements for use of nuclear energy shall be regularly reviewed and modernized taking into account the achievements of sciences and international experience. Government Decree 89/2005. (V. 5.) states that the Nuclear Safety Code shall be reviewed and updated if necessary at least every five years. As a result of the review, Government Decree 118/2011. (VII. 11.) on nuclear safety requirements of the nuclear facilities and on the related legal activities was issued and came into force on 10 August 2011. The reviewed Nuclear Safety Code was published in annexes to the Government Decree.

The requirements related to the new nuclear facilities were recently developed (Volume 9. of Nuclear Safety Code) and the extended set of regulations came into force on 1 April 2012 by Government Decree 37/2012 (III. 9.).

Based on the nuclear safety codes in the field of nuclear safety, it is mandatory to present an independent technical expert’s opinion with the licence applications for plant modifications. The registration and evaluation process for these technical experts is prescribed in the Act on Atomic Energy (Act CXVI of 1996) and its implementation decree (Government Decree 247/2011).

Comprehensive modification of the Nuclear Safety Code was undertaken in the second half of 2014, covering on one hand the results of the revision of the Western European Nuclear Regulators’ Association (WENRA) requirements, and also the results of other countries’ NPP construction experience, relevant Finnish and British regulations and also the Hungarian licencing experience.

In order to be prepared for the construction of the new nuclear power plant units, Volume 3/A of the Nuclear Safety Code on nuclear safety requirements to be applied during the design was published in 2015.

In addition to the continuous development of IAEA recommendations and WENRA reference levels, the Hungarian regulations are reviewed and revised more frequently than the 5 year review period stipulated by law.

In January 2014, the Hungarian Government signed a bilateral agreement (Intergovernmental Agreement, IGA) with the Russian Federation on cooperation in the field of peaceful utilization of nuclear energy. The agreement was promulgated in Act II of 2014. The agreement covers, among others, the cooperation necessary for replacing the capacity of the Paks NPP, which means the planning and construction of two new nuclear units at the Paks site. In accordance with the IGA, on 28 March 2014, the Government of Hungary and the Government of the Russian Federation signed an agreement on the provision of a state credit (Financial IGA, FIGA) of maximum EUR 10 billion to Hungary to finance 80% of the project (for funding details see Section 2.3.2.). This agreement was promulgated in Act XXIV of 2014. As promulgated acts, these agreements (IGA, FIGA) are available in their full scope to the public.

A government commissioner was also assigned by Government Resolution 1358/2014 (VI. 30.) to supervise and support the project from 1 July 2014. Since November 2014, the MVM Paks II. Ltd. is under direct State ownership and is controlled by the Minister leading the Prime Minister’s Office.

After the negotiations in the second half of 2014, MVM Paks II. Ltd. and the Russian Joint Stock Company Nizhny Novgorod Engineering Company Atomenergoproekt (JSC-NIAEP) signed three implementation agreements on 9 December 2014. These agreements include (1) the engineering, procurement and construction contract (EPC) for two WWER-1200 type new nuclear units; (2) operation and maintenance support contract; and (3) nuclear fuel supply contract. In April 2015, the Euratom Supply Agency cosigned the nuclear fuel supply contract.

With the intergovernmental agreements and the implementation agreements, the project’s fundamental elements — its contractual framework — was established.

Also in 2014, the Hungarian nuclear licensing regulatory framework was revisited, modernized and made fit for instant licensing procedures. As a result, Act VII of 2015 (Project Act) was adopted by the Hungarian Parliament and the licensing and investment environment of the project was successfully created. The new rules include an extension of the staff and the remuneration of the main licensing authority (Hungarian Atomic Energy Authority, HAEA) and an increase the timeframe available for the HAEA to evaluate the construction licensing documentation from 6 months to 18+3 or 12+12+3 months.

The preparations for construction of the new units are coordinated by MVM Paks II. Ltd (project company) and the Government Commissioner of the project.

Site investigation and Evaluation

As stated above before, the units will be built on the site of the Paks nuclear power plant currently in operation. Despite the in-depth knowledge of the site (which is the most explored and best known geological area of Hungary) the project company decided to conduct a thorough site investigation and evaluation programme to double check whether the most up to date geological exploration methods confirm the suitability of the site to host two new units and in order to check the site-specific data necessary for the design of the plant. In 2014, the project company obtained the site investigation and evaluation licence from the HAEA, which enables the execution of the site investigation programme. In the autumn of 2014, extensive 3D seismic exploration was carried out on a territory of about 300 km² around the site. In spring 2016, several deep drilling activities were performed or were in progress and several shallow boreholes were drilled outside the site for the identification of the geology and the tectonics of the area. Further, several other geological mapping, other geophysical, geotechnical and hydrogeological research projects were accomplished in 2016 on the site itself and/or its surroundings.

The site licence application was submitted by the project company on 27 October 2016 to the Hungarian Atomic Energy Authority. Following this, the project company held public forums on the subject in Paks, Szekszárd and Kalocsa, and every household of the 41 settlements near the site received an 8 page informative publication. To inform the public, an informative, summarized article was published in the regional newspapers of each county, and the 8 page publication was available as an appendix in the national dailies as well. The public hearing — as part of the site licensing process — was held on 13 December 2016 in Paks, organized by the HAEA.

Environmental Licensing

In 2012, the preliminary consultation document (PCD) was sent to 30 European countries. Based on this, 11 countries have registered their intention to participate in the environmental licensing procedure (according to the Espoo Convention) for the two new units. In addition, more than 10 Hungarian non-governmental environmental organizations have been registered in order to participate in the procedure as parties. The environmental licensing procedure was initiated at the end of 2014 with the submission of the more than 2000 page environmental impact assessment study, available also in English here:

http://www.mvmpaks2.hu/hu/Kozerdeku/KozerdekuDokumentumok/KornyezetvedelmiEngedelyezes/KornyezetiHatastanulmany/Lapok/default.aspx

In the spring of 2015, an information forum series was held in 41 settlements around the Paks site with the objective to draw the attention of the public to the environmental licensing procedure and request that they submit their comments on the environmental impact assessment of the new nuclear units. On 7 May, a public hearing was held in Paks with roughly 600 participants. To meet the request of the participating countries, 9 international hearings in 7 interested countries (Austria, Croatia, Germany, Romania, Serbia, Slovenia, Ukraine) were successfully concluded in September–November 2015. With this, the bulk of the international environmental licensing procedure was completed by the end of 2015.

The project company received the first instance environmental licence issued by the Authority on 29 September 2016.

Remaining Ongoing Pre-construction Activities

In 2017 the main task will be to prepare the construction licence application and the related documentation.

TABLE 6. PLANNED NUCLEAR POWER PLANTS

Station/project name	Type	Capacity	Expected construction start year	Expected commercial year
Paks 5	WWER-1200	1200 MW(e)	2018	2025
Paks 6	WWER-1200	1200 MW(e)	2020	2026

 

The delivery of the new nuclear power plant units will be a turnkey project.

Accordig to the FIGA, the Russian Party (Russian Federation) grants for the Hungarian Party (Hungary) in the maximum amount of 10 billion EUR credit will finance 80% of the Contract Price of the EPC. 20% of the Contract Price will be financed by the Hungarian State.

Conditions of the credit line available to the Hungarian state as set out in the Financial IGA are as follows:

Disbursement period: 2014–2025;

1. Credit amount: 80% of the agreed amount of EPC, maximum EUR 10 billion;

2. Repayment period: 21 years;

• Years 1–7: 25% of the whole amount;

• Years 8–14: 35% of the whole amount;

• Years 15–21: 40% of the whole amount;

Interest rate:

• During the investment period: 3.95%;

• First seven years of repayment: 4.50%;

• Second seven years of repayment: 4.80%;

• Third seven years of repayment: 4.95%;

1. Commitment fee: 0.25% of the undisbursed amount from the preliminarily agreed annual credit line.

A new high voltage substation and a new double circuit overhead line of 400 kV are planned to be constructed. In order to provide increased reliability, the new substation and the substation of the existing nuclear power plant will be connected by means of two coupling lines of 400 kV.

The planned installation site of the new Paks II nuclear power plant units falls within the boundaries of the site of the Paks Nuclear Power Plant. The site of the Paks Nuclear Power Plant is located in Tolna County, 118 km south of Budapest. The plant lies 5 km south of the centre of Paks, 1 km west of the River Danube and 1.5 km east of Main Road No. 6.

For the new units, the site investigation and evaluation licence was issued by the Hungarian Atomic Energy Authority in 2014. Project company MVM Paks II. received an environmental licence in 2016. The site licence was issued by the HAEA in 2017.

The legal framework for implementation of the R&D programme is established in the Act on Atomic Energy, according to which the technical support activities needed for improving the safety of the peaceful application of nuclear energy shall be financed via the HAEA. Thus, it is the responsibility of the HAEA to manage the scientific-technical support for the nuclear safety and security regulatory activities. For managing the quality of such a complex programme, the HAEA defined its basic principles and requirements for performing technical support activities. The scientific-technical support is provided by a group of scientific-technical institutions and other engineering organizations (Technical Support Organizations — TSOs). As a rule, the scientific-technical cooperation with the strategic partner TSOs (with a wide range of competency in nuclear facility operation and regulation) is based on a long term agreement accepted and signed by both the HAEA and the partner TSOs. At present there are several strategic Partner TSOs including the HAS Centre for Energy Research (CER), the Nuclear Safety Research Institute (NUBIKI) and the Institute of Nuclear Techniques of the Budapest University of Technology and Economy (BME NTI). The requested technical support from a TSO is described in a contract in which the deadline and the expected quality are further defined. In urgent regulatory matters the strategic TSO Partners — based on the above mentioned strategic agreement — provide technical support quickly and flexibly on a free of charge basis. The system of TSOs ensures that the HAEA has appropriate engineering and scientific reserve capacities to handle situations which need fast and technically correct decisions.

To efficiently harmonize TSO cooperation, the HAEA has developed a middle term R&D concept which has been regularly updated. The R&D concept assigns the main goals — the area of the support programme. The most important R&D areas are: development of the regulatory framework, support and modernization of the regulatory work, new nuclear facilities, decommissioning and radioactive waste management, development of operational safety, development of risk informed supervisory instruments, analysis of beyond design basis and severe accidents, nuclear emergency response, nuclear material accountancy and control, supervision of radioactive material, physical protection and regulatory control of radioactive waste storage facilities.

Collection of data about knowledge and competencies (so called knowledge profile) of TSOs was started in 2005, and TSOs are permanently surveyed about their competencies and cooperation affinity in 10 main areas of regulatory interest divided into 48 specific subareas. Based on the demands connected with new build units, the knowledge profile of TSOs was completely reviewed in 2015. As a result of the review the TSOs can offer their knowledge in 26 main areas which can be divided into 180 specific subareas. As a result, it can be concluded that in Hungary all major scientific-technical areas important for nuclear safety are covered by research or technical institutions.

The attention of research organizations is also attracted by other nuclear systems. The Generation-4 SCWR (more accurately, its European version, HPLWR) is currently being studied in Hungary in the framework of a nationally financed project which gives a good background for participating in a European Union project with a similar aim and in several bilateral cooperation projects. The decision on constructing ITER also attracts scientists to deal with various aspects of fusion technology rather than restricting themselves to plasma physics.

The Centre for Energy Research, together with its Czech, Slovak and Polish partners, with strong technical support of CEA, started the preparatory activities to launch the ALLEGRO project for establishing a 75 MWth demonstration of gas fast reactor technology in 2010. These preparatory activities include:

• Finalization of the design and the safety concept of the ALLEGRO reactor;

• Clarifying fuel related problems;

• Defining the R&D needs for starting the licensing and construction of ALLEGRO;

• Paving the way to license ALLEGRO by the nuclear safety authorities;

• Preparing the outline of the EIA;

• Defining the technical details of site selection;

• Proposing the method of site selection;

• Defining the governance structure of the project;

• Clarifying IPR;

• Organizing the political support and financial support of the project.

Most of these activities will be concluded in 2014; however, R&D activities will continue in the medium and long term.

In July, 2013 four nuclear research institutes and engineering companies from central Europe’s Visegrád Group (V4) of nations decided to establish a centre of excellence for joint research, development and innovation in Generation IV nuclear reactors. The V4G4 Centre of Excellence is registered in Slovakia and managed by a steering committee and is being set up by scientific and research engineering company ÚJV Rež AS of the Czech Republic, the Academy of Sciences Centre for Energy Research (MTA EK) of Hungary, Poland’s National Centre for Nuclear Research (NCBJ) and engineering company VUJE AS of Slovakia. The preparatory phase is ongoing; the Centre is to be operational by 2020.

In Hungary both the licensees and the HAEA maintain wide ranging relations with various international organizations, with other countries and institutions involved in the design, manufacture, installation and operation of nuclear facilities and research institutes.

These relations serve as a means of exchanging knowledge and experience. The fact that Hungarian experts are held in high esteem internationally is demonstrated by their active role on different committees, with many of them being board members of international organizations or invited as experts.

Hungary has been a Member of the International Atomic Energy Agency since 1957 and the OECD Nuclear Energy Agency since 1996.

Hungary has bilateral international agreements with Australia, Austria, Canada, Croatia, the Czech Republic, Germany, Romania, the Republic of Korea, the Russian Federation, Serbia, Slovakia, Slovenia, Ukraine, the United States of America and Viet Nam.

There are several memoranda of understanding on cooperation and mutual information exchange concluded by HAEA with other regulatory authorities, i.e. those of the Czech Republic, Finland, Romania, the Slovak Republic, the Republic of Belarus, the Russian Federation, Turkey, Ukraine and the United States of America.

Regional programmes organized by the European Union and the IAEA play an important role in the cooperation between the regulatory authorities of neighbouring countries. Moreover, the HAEA is taking part in quadrilateral cooperation including the Czech Republic, Slovak Republic and Slovenia.

The HAEA takes part in several international cooperation activities including:

International Organizations

International Atomic Energy Agency (IAEA);

• Nuclear Energy Agency of the Organization for Economic Co-operation and Development (OECD/NEA);

• European Atomic Energy Community (EURATOM);

• Comprehensive Nuclear-Test-Ban Treaty Organization (CTBTO).

Multilateral Cooperation

Nuclear Suppliers Group (NSG);

• Zangger Committee.

Nuclear Forums

Western European Nuclear Regulators’ Association (WENRA);

• European Safeguards Research and Development Association (ESARDA);

• European Nuclear Security Regulators’ Association (ENSRA);

• Heads of European Radiological Protection Competent Authorities (HERCA);

• European Association of Competent Authorities for Safe and Sustainable Transport of Radioactive Material (EURACA).

The Paks NPP is a member of several international bodies of major importance including the World Association of NPP Operators (WANO), the WWER-440 operators’ club, the WWER users’ group, the International Nuclear Safety Programme (the so-called Lisbon Initiative) and the Nuclear Maintenance Experience Exchange (NUMEX).

MVM Paks II. Ltd. is also a member of the World Association of NPP Operators (WANO).

The Public Limited Company for Radioactive Waste Management (PURAM) takes part in the activities of the relevant international organizations (IAEA, OECD/NEA etc.) and maintains bilateral contacts with other companies involved in rw management in other countries.

The Hungarian Nuclear Society is a member of the European Nuclear Society (ENS), and the Health Physics Section of the Roland Eötvös Physical Society is a member of the International Radiation Protection Association.

The technical support organizations of the HAEA take part in international activities including the working groups of the OECD/NEA.

Before 1991, the Hungarian Atomic Energy Commission (HAEC) managed most of the nuclear aspects related to international relations, preparation for legislation, internal relations, and nuclear regulatory and licensing activities. The scope of activities and responsibilities of the HAEC were redefined in a Government Decree, which came into force on 1 January 1991. The HAEA was established as a new, nationwide central state administered organization under the supervision of its President of the HAEC. The revised Act on Atomic Energy adopted at the end of 1996 (Act CXVI of 1996 on Atomic Energy) and its Decrees on Implementation introduced further changes in the scope of authority and organizational structure of the national regulatory bodies related to nuclear safety.

According to the above mentioned changes in responsibilities, the licensing of nuclear facilities became the responsibility of HAEA. In addition, the regulatory control over certain construction, technical radiation protection and nuclear accident prevention issues was also transferred into the scope of the authority of the HAEA.

Hungary’s accession to the European Union required further strengthening of the regulatory bodies’ independence. To this end, the Parliament amended the Act on Atomic Energy in 2003. Pursuant to this amendment, the operation of the HAEC was discontinued and one of the ministers of the Government appointed by the Prime Minister — currently the Minister of National Development — was given the task to supervise the HAEA. The role of the Director General of the HAEA became more significant: he or she is responsible for giving an annual report to the government about the safety of the domestic application of nuclear energy, instead of the chair of the HAEC. Furthermore, he or she shall participate, with the right of consultation, in the sessions of the Government when any proposal related to the scope of activity of the HAEA is considered.

The administrative duty of the nuclear safety authority comprises two types of task. On the one hand, the authority shall perform the relevant regulatory tasks and issue standards and requirements, while on the other hand, these regulations and requirements must be enforced (this is realized during the implementation of the licensing and inspection/enforcement procedures).

The supervisory responsibility of the HAEA involves the following activities: it enforces compliance with the provisions of relevant statutory regulations, ensures that the requirements of Nuclear Safety Regulations are observed and the conditions serving as a basis for regulatory licences are met, and in addition, it monitors the implementation of the measures imposed by the Authority. The HAEA also carries out analysis and assessment activities that are related to its licensing and inspection responsibilities. In some cases, the official licensing and inspection activity also entails the initiation of law enforcement measures. Enforcement activities comprise all the measures to ensure that the licensees return to compliance with the regulations in the case of deviations, and also involve those that encourage participants to avoid repeated deviations.

There was an amendment to the Act on Atomic Energy in 2005 (owing to the new general rules of the administrative regulatory procedures) which introduced continuous regulatory supervision. The supervision may be exercised through on-line computer systems connected to the authority office network. The amendment gave the definition of clients in the cases of licensing and permission. Furthermore, the deadlines of the administrative regulatory procedures were also modified for the HAEA and its coauthorities (60+30 days for equipment level licences, 180+90 days for facility level licences, 30+30 / 60+30 days for the coauthorities). In case of imminent danger, accident or emergency situation in the nuclear facility, it gave an opportunity for deviations from the procedural rules as well.

Further modification of the Act CXVI of 1996 on Atomic Energy was adopted in 2011. In Act No. CIX of 2006 on the reorganization of the governmental structure the HAEA is listed among the government offices. The scope of authority and duties of a government office are required to be regulated on the statutory level. Until 2011, the legal regulation of scope and duties was included in two different sources: the Act on Atomic Energy and the Government Decree 114/2003 on the Scope of Duties, Authority and Competence to Impose Penalties of the Hungarian Atomic Energy Authority, and on the Activities of the Atomic Energy Co-ordination Council. The modification ended the two level regulation system and moved up all the relating regulation to the statutory level. The modification also concerned the use of subsidies by municipal associations around nuclear facilities; now they may use the subsidies for information, monitoring, operation and to ensure municipal development.

According to the Act, the licensee is obliged to present an expert’s report before an administrative procedure (non-procedural expert). The amendment allocates the task of evaluation of independent nuclear experts to the Hungarian Chamber of Engineers. The Hungarian Chamber of Engineers, as an independent professional public body, can give substantive assistance to the regulatory body. The new modification of the Act defines the Design Basis Threat (DBT) and nuclear security and provides a clear basis for allocating responsibilities between the organizations involved. The Act also identifies protection functions that are the responsibility of the State. The Government is empowered by the Act to develop more detailed provisions of DBT and nuclear security in a government decree.

From 2013, the Act declares that in all facility level licensing procedures, the HAEA shall arrange public hearings to ensure transparency and openess.

From 1 July 2014 the responsibilities of the HAEA underwent several changes. According to this amendment, HAEA took over the task of regulatory oversight of the radioactive waste repositories. The Act also introduced new procedures relating to licences for site assessment and evaluation, and licences to define characteristics and to determine the suitability of the site.

HAEA took over the regulatory tasks for radiation protection. The Act VII of 2015 gave the scope of duties of radiation protection to the atomic energy oversight organization from 1 January 2016. The Act separated the regulatory tasks among the authorities. The Office of the Chief Medical Officer will remain the competent authority for radiation health issues, while the Hungarian Atomic Energy Authority will be responsible for supervision of other radiation safety matters. The purpose of the amendment is to integrate the regulatory framework for nuclear safety, radiation protection and physical protection of the peaceful use of atomic energy under the same authority. This way a single level, country wide, customer centred regulatory regime will be realized, making licensing easier, reducing the number of licensing processes per licensee, and unifying data supply to be performed by the users of atomic energy.

The Project Act furthermore transfers the responsibilities to HAEA for construction of general civil structures and buildings of nuclear facilities and radioactive waste repositories as of 1 January 2016. Lower level legislative amendments are also to enter into force on 1 January 2016.

The basic principles of licensing procedures for NPPs, and the authorities taking part in licensing procedures, are regulated by Chapter III of the Act on Atomic Energy. To establish a new NPP or a new NPP unit, the preliminary consent in principle of Parliament is required for starting preparatory work, whereas to establish ownership of a NPP that is in operation or to transfer the right of operation, the consent in principle of the Government is required. In concordance with regulations in force, a licence shall be obtained from the authorities for all phases of operation (siting, construction, commissioning, operation, decommissioning) during the lifetime of a NPP. Moreover, a separate licence shall be obtained for all plant level or safety related equipment level modifications. Within the licensing procedures, technical aspects are enforced by legally delegated authorities. The Authority shall take account of opinions of legally delegated special authorities. When the installation of a new NPP is being considered, the precondition for launching the licensing procedure is the existence of an environmental protection licence. During the licensing procedure the Licencee prepares a preliminary environmental impact study. The environmental protection authority then sends the preliminary impact study to the relevant authorities to seek the opinion of authorities of potentially affected areas who — in turn — expose it to public view. The environmental protection authority, if it does not reject the detailed environmental impact study that has been submitted, shall subsequently hold a public hearing. Based on the detailed environmental impact study and on any responses received, the environmental protection authority may issue an environmental protection licence for the construction and operation of the plant.

The safety related licensing of a nuclear installation takes place after the environmental licensing. The environmental protection authority plays the role of special authority in the course of licensing a nuclear installation. During the licensing of installations and equipment, and the licensing of their modifications, the contributing procedure of the environmental protection special authority provides the possibility for the civil organizations to act as clients. The decisions of the nuclear safety authority are made public. Those licences to be issued based on Act CX. of 2001 on Electric Energy are also required for establishing and operating a nuclear plant. Licences are valid for fixed periods; on request and provided that the necessary requirements are fulfilled, they may be extended. A licensee can appeal against the decisions of the Authority. It has the right to appeal in court.

Every ten years a periodic review of the safety of the NPP is performed on the basis of a comprehensive, predefined programme known as the Periodic Safety Review. Any decision on the further validity and conditions of the operating licence is made within the framework of the review. For certain facilities, beyond the regulatory licensing procedure, the Act on Atomic Energy prescribes higher approval as well.