Cancelling the Paks II Nuclear Power Station Could Cost Hungary Billions

The old reactors of the Paks Nuclear Power Station have been put to the limit due to this year’s severe droughts

According to nuclear energy expert Zsolt Hárfás, halting the Paks expansion could result in a compensation liability amounting to billions of euros. Furthermore, the potential termination of the contract between Rosatom and Hungary could have long-term implications for the country’s electricity supply, wrote vg.hu.

The expert illustrated the potential consequences of such a decision by citing the example of a halted nuclear power plant project in Finland. In 2022, the Finnish company Fennovoima terminated its contract for the construction of a Russian VVER-1200 reactor. An arbitration tribunal ruled the termination of the contract to be unlawful, a finding that could establish a liability for damages. Rosatom has stated that it intends to provide further evidence to substantiate its claim. The expert added that by halting the project, Finland has also forfeited a planned power generation capacity that could have produced approximately 9.5 terawatt-hours of electricity annually.

The Finnish case may also hold lessons for Hungary. Infostart reports that Péter Magyar has alluded to the possibility of terminating the contract with Rosatom, while the government plans to decide on the fate of the investment by the end of the year. Cancelling the project—valued at over ten billion euros—could lead to claims for damages amounting to several billion euros. Such claims could encompass costs related to planning and preparation, work already performed, payment for equipment that has been completed or is currently under production, as well as lost profits. The actual financial consequences would depend on the specific terms of any contract termination and the subsequent legal proceedings.

Zsolt Hárfás notes that, beyond the financial implications, the loss of the planned generation capacity must also be taken into account. In his view, the failure to complete the two new units at Paks could result in a long-term loss for Hungary. The expert also pointed out that for a significant portion of the year, Hungary relies on electricity imports—including from Austria. He believes that commissioning the new units could substantially alter this situation and potentially even create opportunities for increased electricity exports.

In the meantime, the project itself has taken another milestone. Jet Engineering and Technical Center (ETC Jet)—part of the Rosatom Service group—has met the requirements set by Paks II. Zrt., the Hungarian client for the Paks II project, Rosatom announced to the Hungarian news agency MTI on Tuesday. According to the statement, the Russian company—which is supplying the unit control room simulator and the analytical simulator for the Paks II Nuclear Power Plant—underwent an audit for suppliers in the nuclear energy industry. The audit was conducted by Atomstroyexport (ASE JSC), the general contractor for the Paks II project.
The analytical simulator, which runs on monitors and helps personnel understand and practice power plant processes, is scheduled for delivery to the Paks II site in December 2027. The full-scope unit control room simulator is set to arrive at the power plant’s training and simulator center in the spring of 2028, the statement noted.

The full-scope simulator will be an exact replica of the Paks II Nuclear Power Plant’s unit control room, capable of simulating all operational states of the power plant through the use of computer software. In addition to the training and examination of operating personnel, the simulator allows future operators of the nuclear power plant to practice by modeling real-life scenarios for dozens of hours each year, thereby minimizing the risk of operational malfunctions and accidents, the company explained.

Featured Image: MTI/Bodnár Boglárka

The post Cancelling the Paks II Nuclear Power Station Could Cost Hungary Billions appeared first on Hungary Today.