Climate change current policies and economic growth What

Climate change: current policies and economic growth What Way Forward to Ensure Both? HUNGARY

AGENDA n KYOTO IN TRANSITION COUNTRIES n ACTUAL CHALLENGES n FUTURE CHALLENGES

KYOTO TARGETS Hungary and other TRANSITION COUNTRIES

GMG emissions 2002 vs. 1990

Annex I countries

ANNEX I countries Average Delivery of Promise: -6% n GAP n – Developed economies (USA, Germany UK) § Achievement: based on Kyoto Protocol : Germany UK (350 bln tpa) § USA – Transition countries (New 10 EU countries, Russia) § Result: happened aside of Economic crisis, bankruptcy of companies, Shut down of plants § Russia finnaly signed Kyoto Protocol

CO 2 and GHG Emission in Hungary n Commitment: emission -6% vs avg of 1985 -87

Consequencies n Hungarian industry has not to buy CO 2 n Hungary will sell CO 2 quota n Environmental standards – No cost increase becasue buying – Increase of Hungarian Budget – Hungary must keep these rules due to our EU membership Hungary will be a follower and not a decisionmaker in pricing n Kyoto goals must apply for all new Investment and modernisation n

Quota allocation vs. other countries

Quota Allocation vs. New EU 10

Hungary is 1 of the 4 from 25 n Only 4 member states sell quota in Auction – Denmark 4% – Hungary 2, 5 % – Lithuania: 1, 4 % ? – Ireland 0, 75% n Auction has it’s own cost

Challenges

Sectors in Hungary Electricity and Heating

% of Nuclear in WE

% of Nuclear in some NEW 10+2

FUTURE CHALLENGES

Future Energy needs Brutto energy growth 2%/year =60 TWh before 2010 power plants must stop due to EU standards: =1300 TWh n 2012: PAKS Nuclear Power Plant n n – Lifetime extension: +8% growth due to Investment achievable – Closure: =-2000 MW Additional Need: = 6000 MW by 2020 In the case of traditional Power plant the CO 2 emission is minimum 11 mln Tpa n Renewable can contribute, but can not close the GAP n THE PLANNING DID NOT START YET, POLITICAL PARTIES ARE TOO MUCH DIVIDED TO ACHIEVE A COMPROMISE n n

GDP growth in Hungary n n We achieved the 1989 GDP level in 1998 only From 2000 the GDP growth declines Till 2010 we forecast 4% of average growth ( too optimistic) Cost of agening society will grow after 2010 – Due to the „RATKO children” – Due the low wages and Black market

WHAT CAN WE DO? n n n POLITICS MUST UNDERSTAND THE NEED POLITICS HAVE TO GET A NATIONAL MINIMUM COMPROMISE TO BUILD A NEW POWER PLANT(S) KYOTO TARGETS AND ECONOMIC GROWTH MUST BE HARMONISED ALL ENERGY SECTOR MUST ALLOW TO DEVELOPE PAKS NUCLEAR POWER PLANT MUST GET GREEN LIGHT TO CONTINUE WE CAN NOT ACHIEVE IT WITHOUT STRONG SUPPORT FROM EUROPEAN POLICY MAKERS