The Hungarian renewable energy sector has recently undergone a huge development, mainly focusing on photovoltaic power plants. In Hungary, rooftop photovoltaic projects are mainly widespread among households and companies to cover their own electrical needs. These projects are so-called household power plants, which are basically micro power plants connected to the low-voltage system.
The general rule regarding this kind of power plant is that the produced electricity shall be accepted and bought by the electricity trader or universal service provider upon the producer’s request. However, due to network capacity issues, the Government temporarily suspended the possibility of feeding the electricity generated by household power plants to the public network and only those household power plants may be installed which produce electricity solely for their own electricity consumption. This restriction did not concern those household power plants which were implemented based on connection requests submitted before 31 October 2022.
The restriction was introduced since the number of solar power stations in Hungary was growing rapidly and the electricity grid in all parts of the country was not able to keep up with the development. The sudden change in grid connection rules created uncertainty and hindered the deployment of residential solar power systems. However, by today, certain improvements to the Hungarian electric system have been made, thus, the temporary suspension of feeding the electricity back into the grid will be terminated by the end of this year, communicated by the Hungarian Government recently. The removal of restriction will not apply to all parts of Hungary, but only to certain areas of the country. The Government will announce in the coming weeks which areas will be able to reconnect the household power plants to the grid again. What remains to be clarified is the tariffs at which households will be able to benefit from the possibility of connecting to the grid in the future.
During the establishment of the tariff-regime, the Hungarian Government has to take into consideration the EU Directive 2019/944 on common rules for the internal market for electricity, which expressly set that citizen energy communities are subject to non-discriminatory, fair, proportionate and transparent procedures and charges, including with respect to registration and licensing, and to transparent, non-discriminatory and cost-reflective network charges ensuring that they contribute in an adequate and balanced way to the overall cost sharing of the system.
By Lilla Majoros, Attorney at law, KCG Partners Law Firm