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Summer School

Energy Investment Regularion Conference 2008, Budapest

HUNGARY
Hungarian Energy Office (HEO)



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Key Statistics (2008)

Population

10.1 mln

GDP/Capita

$5,569

Generation

Fossil fuel: 58%
Nuclear: 36.7%
Hydro: 0.5%
Renewables: 4.8%

Electricity Market Size

43.946 TWh/year

Surplus Installed Capacity over Demand

2.2 TW

Net Electricity Importer

(4 TWh); Slovakia main trading partner

Natural Gas Imported

11.7 bln m3 (80 %)

Natural Gas Consumed

14.8 bln m3

Natural Gas Storage Capacity

3.4 bln m3

Natural Gas Domestic Production

3.1 bln m3

Summary
  • Established in 1994, 94 staff members
  • Ferenc Horvath J. was appointed President of HEO on October 31, 2003. The Prime Minister upon proposal of the Minister of Economy appoints the President and the Vice-President for a 6 year term.
  • HEO regulates and supervises energy activities of electricity and gas companies, heat production of electric power stations and CHP companies over 0.5 MW and protects customer interests.
  • Fees from licensees regulated by the joint decree of the Minister of Economy and Transport and the Minister of Finance cover the HEO’s operating costs.
    • Industry and Market Structure

    Electricity

    • 14 large generation companies; 10 owned by private investors (Tractebel, RWE, AES, ATEL, EdF, Croesus, EON)
    • 1 public wholesale company (state owned)
    • 6 regional distribution/supply companies owned by RWE, EON, EdF
    • Generation prices for public service (as of February 2006 again), general system usage charges, public wholesale and end-user prices are regulated
    • Two parallel market model: regulated (public) and liberalized
    • Power Purchase Agreements between several generators and wholesaler
    • 1 TSO (State-owned)
    • Member of CENTREL (regional organization of transmission system operators of Hungary, Slovakia, Poland and Czech Republic) and UCTE (Union for the Coordination of Transmission of Electricity)

     

    Natural Gas

    • Market structure: 1 transmission company, 1 wholesaler, 1 storage company, 1 TSO, 10 distribution companies /public utility supply companies, 3 LPG supplier, 14 natural gas traders, cross-border traders
    • Wholesale and end-user prices are regulated
    • 40 % of natural gas market was opened on January 1st, 2004. , beyond the household customers all customers have the possibility to enter the market, 8,1% of non-household customers entered the market
    Current Energy Issues
    • 66% of electricity market is open from July 1 2004, and 65,4% of the natural gas market is open from January 1, 2004 (in legal terms)
    • Regulated third party access, cross border trade, stranded costs, market power monitoring, public service obligation
    • Regulated prices are prepared by the Hungarian Energy Office and approved or rejected by the Minister of Economy and Transport; new gas price regulation has been effective since January 18, 2006 for 4 years, the four-year electricity price regulation period started at the beginning of 2005
    • Harmonization of the energy policy according to the European Union Directives.
    Contact

    Köztársaság tér 7, H-1081 Budapest, Hungary
    Tel./Fax: (36 1) 459 7777
    Internet: www.eh.gov.hu
    http://www.erranet.org/AboutUs/Members/Profiles/Hungary

     

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