Hungary - Stagnating capacity may challenge 2020 target

HUNGARY: Hungary is not expected to add any new wind capacity in 2013, as the country remains stuck at the 329MW mark it has found itself since the end of 2011.

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The Hungarian government has made it clear that renewable energy is not a priority.

"I'm afraid that the renewables period in Hungary is over," says Andrea Kircsi, president of the Hungarian wind energy association. In 2010 Hungary's government shelved plans to seek tenders for an additional 410MW in wind capacity and there is widespread pessimism a new tender will be announced in 2013.

The government has still not revealed long-awaited details of a planned new incentive scheme, known as Matir. "About a year and a half ago, they published the first draft of the new incentive scheme with the general principles behind it. Those were fine, but since then everyone's been awaiting the actual figures," says Peter Simon, a partner at international law firm CMS Cameron McKenna's Budapest office.

On the brighter side, while Hungary's cash-strapped government has rolled out taxes on traditional energy plants, Simon says it has not taxed renewable energy producers. Amid the economic crisis renewable energy has simply slipped off the government's radar. "In the longer term, I'm more optimistic about the possibilities for wind and other renewables in Hungary," says Simon.

Should it rediscover wind, Hungary will have some catching up to do. The government's national renewable energy action plan foresaw 552MW of wind capacity by 2013 and 740MW in commercial wind farms by 2020.

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