AmCham’s newly launched European Green Deal working group held its first plenary session on 16 April focusing on clean energy transition in the light of the policy initative and best practice sharing regarding clean energy in different industries.
Attila Steiner, Secretary of State for the Development of the Circular Economy, Energy and Climate Policy from the Ministry for Innovation and Technology in his keynote speech introduced the Hungarian government’s policy plans regarding the European Green Deal and mid-to long-term targets in reaching carbon neutrality.
Hungary’s Climate and Nature Protection Action Plan contains 8 action points corresponding to the main goal of Hungary's integrated energy and climate policy, which is to meet our 2030 climate protection goals in order to preserve Hungary and the Carpathian Basin for future generations.
“Hungary domestically strives to achieve climate neutrality by 2050, which goal was first set by the Government-approved draft of the Hungarian long term climate strategy (National Clean Development Strategy - NCDS). As of 10 June, we have the 2050 climate neutrality target set in law - which is the first in the region - when the Hungarian Parliament approved Law No. XLIV of 2020 on Climate Protection” – highlighted the State Secretary.
The climate law specifies:
- Reducing domestic greenhouse gas emissions by at least 40% by 2030 compared to the 1990 levels
- From 2030, in the case of final energy consumption going beyond 2005 levels, the increased consumption will be provided from carbon neutral energy sources
- By 2030, the share of renewable energy sources in the gross final energy consumption will be at least 21%
These targets of the NCDS are continuously revised and fine-tuned accordingly.
In order to meet these targets, Mr. Steiner also identified the key areas for intervention and introduced specifically designed support programs, such as Environment and Energy Operational Program Plus (KEHOP+) and the National Recovery and Resilience Facility (RRF).
These programs are to encourage renewable energy generation and consumption, create a Hydrogen ecosystem in Hungary and introduce energy efficiency measures (mainly by the Energy Efficiency Obligation Scheme) targeting the residential and public sector alike and the SMEs. It is also very important to raise awareness of climate change and its mitigation, as well as modernizing power plants by replacing coal- and lignite firing with more sustainable technologies.
Transitioning through Innovation
In the second part of the plenary session, plans and challenges of green energy transition were discussed by corporate actors. In the oil & gas and the chemical sectors all activities are or will be affected by the European Green Deal.
The aim of reaching net zero by 2050 requires accelerated low-carbon transition and shifting from a linear structure to the circular economy model and integrate it into the core business. For instance, MOL Group in their new profitably towards net-zero strategy, is integrating bio- and waste-based streams in production and scaling up recycling in their feedstock, operations and services.
“Our goal is to transform the largest Pannonian oil and gas producer into the largest Pannonian player in CO2 storage” - said Ilona Vári, MOL Group’s Head of EU Regulatory Affairs.
Similarly, BAFS’ journey to net zero emissions by 2050, is an innovation led approach, that gives them the opportunity to create markets for low-carbon products and materials, thus achieving European Green Deal objectives, highlited Shradha Abt, BASF’s EU Government Relations Office’s Deputy Head.
However, the greatest challenges are the CO2 costs and implementation of the new process technologies and new regulations. Large-scale CO2-reductions can only be achieved through a significant electrification of industrial processes, leading to a huge increase of low-carbon electricity demand. For this reason, industrial electrification must be enabled with sufficient low carbon power at competitive prices is a decisive factor towards industrial transformation and electrification.
Cutting-Edge Tech and Solutions Pave the Way
Finally, representatives of Bosch, Tungsram, H1 Systems and Infogroup / Deloitte shared their best practices in technology transition in four areas: electromobility, hydrogen, energy efficiency in data centers and sustainability in real estate.
Dr. István Szászi, Head of Engineering Center Budapest at Robert Bosch gave an outlook on the status of CO2 neutrality worldwide, pointing out that the realistic transition period is 30-35 years from now. He mentioned that the Bosch vision 2030 is to invest in electromobility and enhance it from Hungary, as currently 50% of Bosch’s electrification development is located here.
Joerg Bauer, President & CEO of Tungsram Group stated, there is no one size fits all solution in reaching a zero CO2 world: we need hydrogen, batteries, and synthetic fuel. He emphasized the need to change behaviour patterns, such as reducing consumption and waste, while also upgrading to new technologies, such as smart combinations of synthetic fuels, batteries and H2. For H2 specifically he highlighted that the use of Grey or Blue H2 will stay, until technological improvements and demand allows Green H2 to replace it.
‘Tungsram embraces the opportunities of the transition towards a green economy, leveraging its infrastructure, skills and ability to translate innovation to industrialization in diverse areas like batteries, Power2Gas and hydrogen’, says Tungsram President & CEO Joerg Bauer.
Attila Csehi, Senior Key Account Manager at H1 Systems talk about Energy efficient data centers, kicking off his presentation by showing that the power consumed by streaming one of the most watched YouTube videos ever, Luis Fonsi's hit song Despacito, in one year equals 18% of the Paks Nuclear power plant’s output. He mentioned different options to make data centers more energy efficient, such as waste heat recovery, phase changing materials, modern cooling technologies, AI, renewable energy sources or modularity.
The European Green Deal’s effects on our offices, plants and residences was presented together by Ádám Székely from Infogroup and Ákos Lukács representing Deloitte. Their presentation emphasized that buildings consume 40% of total energy used in Europe and greening the building sectors is a high leverage to mitigate climate change. Under the EU Effort Sharing Regulation, Hungary has a target to decrease emissions -7% in 2021-2030 compared to 2005, from high emitting sectors such as buildings. The new EU political ambition to reach at least 55% emission reduction in Europe compared to the current at least 40% will have further impact on how real estate is developed.
We would like to thank Péter Csucska, Managing Director of Lexmark and Board member of AmCham for opening the event and Thomas Narbeshuber, Managing Director of BASF Hungary and Lead of the AmCham European Green Deal Working Group for moderating the event.