Hungarian government backs down from solar energy regime changes

Energy Affairs Minister Csaba Lantos stated in a video message on September 8 that Hungary will maintain a balance-based settlement for homes that currently have solar panels connected to the grid.

According to the statement, balanced-based settlement would be available for 10 years following installation for solar-paneled homes as well as registered projects that are finished by the end of 2025.

Hungarian government backs down from solar energy regime changes
Hungarian government backs down from solar energy regime changes

Over 200,000 homes with solar panels are greatly relieved by the news. According to the balance-based settlement, consumers can withdraw the same amount of energy from the grid during the winter as they did during the summer.

According to the energy ministry’s plan, the state-owned utility firm MVM could purchase electricity during the off-peak months for HUF36 up to 2,523 KhW of yearly use and HUF70 over the threshold, or for literally pennies per kWh (€0.013) during the summer.

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Even though the application of the EU’s compulsory gross settlement (monthly balance) wouldn’t take effect for new payments until January 1, 2024, government officials continued to blame the EU. Retroactive modifications to support programs “should be avoided, as they undermine investor confidence and prevent future investment,” the EU has repeatedly cautioned.

Hungarian government backs down from solar energy regime changes

The Fidesz faction has criticized the administration with exceptional vigor for retrospectively changing the financial terms for properties governed by existing contracts. Mate Kocsis, the caucus leader, urged the energy minister to reconsider plans to convert the monthly settlement to an annual one, which would have resulted in a large rise in household expenses.

industry lobbying organizations and the far-right parties If the government makes the adjustment in the balance settlement, Our Homeland has planned to file a class action lawsuit against it, according to local media. More than a thousand people have shown a desire to participate in the activities independently. Analysts speculated that this could be the reason for the quick change of heart on the plan, noting that the ruling party was concerned the controversial move would further erode its popularity.

A recent poll indicates that Fidesz has lost 20–25% of its supporters since April 2022, but it is still comfortably in the lead with 42% of definite voters, while the Democratic Coalition is in second place with 15% of the vote. Similar to the satirical Two-Tailed Dog Party and Our Homeland, the liberal Momentum party polled at 7-9%.

Hungarian government backs down from solar energy regime changes

From the end of 2023, the government has also committed to lifting the restriction on solar energy feed-in to the grid. The government claimed that the addition of renewable energy, namely solar energy, had overloaded Hungary’s grid, hence the ban went into effect in October 2022.

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