Europe 2020 targets - Hungary

HUNGARY: Hungary, which only handed in its national action plan in December, has been taking its time licensing new wind capacity. A call for wind farm proposals in 2006 capped capacity at 330MW. A new call for proposals, which would free up 410MW more, was shelved by the government last year. Market players are now awaiting a fresh call for proposals, an essential step to show investors that Hungary is committed to meeting wind energy targets.

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Hungary’s 2020 target of 750MW in installed wind capacity and 1.55Twh of electricity production would appear achievable. With 295MW of wind capacity in place at the end of 2010, the target would involve the installation of an annual average of 55.6MW of new capacity over the next decade compared to the 45.5MW annual rate from 2005 to 2010. The target is below forecasts from both the Hungarian and European wind energy associations, HWEA and EWEA, of roughly 1.2GW by 2020. Land-locked Hungary can develop only onshore.

Hungarian authorities have considered the grid as a major obstacle to greater exploitation of wind energy. Market players agree grid development and reduction of connection times, placed at an average of 45 months by EWEA in a recent study of barriers to wind, are issues to tackle. A number of solutions have been proposed, including construction of pumping stations.

Nonetheless, the current wind target, which foresees 740MW of commercial wind plants and 10MW in small-scale wind, is at a level that the transmission system operator has indicated could be handled without grid modifications. It is expected to conduct another study on the grid’s ability to absorb wind power this spring, possibly opening up the way for more wind energy. A new electricity exchange could also help in allowing the grid to handle more wind.

The government may soon by looking for ways to develop more wind. Its action plan, which forecasts it will overshoot its target of tracing 13% of all energy to renewable sources by 1.7%, appears to rely excessively on geothermal power. "The project development time for geothermal energy is too long," notes HWEA president Andrea Kircsi. "Wind can be done quickly and if the government wants to achieve results in renewable energy, I think they will allow for greater wind capacity."

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