Hungary is considering replacing Rosatom in the Paks nuclear power plant expansion project - media
Kyiv • UNN
Hungary is studying alternatives to Rosatom for the expansion of the Paks nuclear power plant. A final decision is expected at the end of this year or at the beginning of next year.
Hungary is considering replacing Russia’s "Rosatom" as the general contractor for the expansion of the "Paks" Nuclear Power Plant and has already begun examining options involving alternative suppliers as part of a review of the project. This was reported by two informed sources, according to UNN, citing Reuters.
Details
The publication notes that the project, which Viktor Orbán awarded to "Rosatom" in 2014 without a tender, is politically sensitive and extremely expensive. The situation is further complicated by the fact that in August, drought brought the plant’s operating reactors to the brink of shutdown.
The expansion of the "Paks" Nuclear Power Plant is "Rosatom’s" largest nuclear project in the European Union—especially after Finland terminated its contract with the Russian company in May 2022. Since then, the parties have been involved in legal disputes.
During Orbán’s tenure, Hungary opposed any sanctions against Russia’s nuclear energy sector.
The government of Prime Minister Péter Magyar (who won a convincing victory in the April election) is expected to make a final decision on the expansion of the "Paks" Nuclear Power Plant later this year or early next year.
The project’s cost, initially estimated at €12.5 billion, had already cost Hungary more than €2 billion ($2.24 billion) by the time the first concrete was poured in February.
Asked whether this could lead to a change of general contractor, a source familiar with the project review said that all possible scenarios were being considered.
According to the source, the review will analyze the legal, technical, financial and time-related consequences of changing the supplier, as well as assess the project’s financial viability.
In addition
According to Reuters, the initial contract with "Rosatom" has already been amended five times; a sixth version of the amendments was prepared but never signed.
Another obstacle was a decision by the European Court of Justice (the EU’s highest court), which annulled the European Commission’s approval of state aid for the project. A second source close to the administration said that the government "is leaning toward the conclusion that the expansion of the \"Paks\" Nuclear Power Plant is necessary," but believes that "Rosatom" should not participate in it.
Nuclear energy can provide substantial amounts of baseload electricity with almost no carbon emissions. However, nuclear power plants usually require large volumes of cooling water, making them vulnerable to droughts and heatwaves—phenomena that are becoming increasingly frequent as a result of climate change.
Despite the high cost and complexity, Hungary’s pro-European government strongly supports the development of nuclear energy. It is necessary for the country to meet growing electricity demand, as well as to balance an energy system that uses intermittent renewable energy sources.
"Nuclear energy and its associated industrial value chains have enormous potential—including at the European level—to guarantee and strengthen our own capacities," said Zsuzsa Beres, Deputy State Secretary at the Ministry of Economy and Energy, responsible for nuclear energy and international relations.
"In the future, we will continue to rely heavily on nuclear energy," she said at a conference held last week.
As a temporary measure while awaiting the expansion of the "Paks" Nuclear Power Plant, Budapest is considering seeking permission to extend the operating life of the plant’s four existing Russian-made reactors by 20 years. Their licenses expire between 2032 and 2037.
Context
Following Russia’s invasion of Ukraine in February 2022, EU member states reduced their imports of Russian oil and gas.
However, Rosatom managed to avoid EU sanctions. According to the World Nuclear Association, in 2025 Russia supplied around 23% of the EU’s uranium enrichment services and 16% of its natural uranium supplies.
If, following the government review, a decision is made that is unfavorable to Rosatom, Hungary may have to cover the €1.1 billion already paid to the Russian corporation, as well as pay penalties for breaching the contract terms.
The sources did not name any potential new suppliers, although one of them noted that bringing in a European supplier would simplify the foreign-policy situation and matters related to sanctions. At the same time, the difficulties associated with managing the project would remain unchanged.
Earlier this month, speaking to journalists in Moscow, Rosatom CEO Alexei Likhachev said that the company was awaiting the completion of the review being conducted by the Hungarian side.
He also said that he had approached the new Hungarian government with a proposal to hold talks, but had not yet received a response.