Hungary unveiled an inter-governmental agreement with the US on nuclear energy, a lucrative area that may bolster ties with Washington following the ouster of Viktor Orban.
The text, which the government filed to parliament late Tuesday, says Hungary will “encourage” picking a US nuclear design or company for any new nuclear investments, including for so-called small modular reactors.
While the agreement stops short of committing Hungary to a specific US contract, it’s a roadmap that may provide an alternative to the country’s nuclear cooperation with Russia. It could also serve as a basis for accommodation between new Prime Minister Peter Magyar and US President Donald Trump, who had endorsed Orban in April’s watershed election.
The Hungary-US framework, which parliament is poised to approve given Magyar’s legislative majority, was submitted ahead of a meeting between Foreign Minister Anita Orban, no relation to the ousted premier, and Secretary of State Marco Rubio in Washington this week. It coincides with lobbying by Hungary to extend an exemption from US sanctions for the continued purchase of Russian crude oil.
“Energy cooperation is probably the most tangible way for the new Hungarian government to ground its relationship with the Trump administration,” said Zsuzsanna Vegh, a researcher at the German Marshall Fund of the United States in Berlin.
Hungary is currently conducting an energy-policy review, including on the possibility to extend the lifetime of the four reactor blocs in the country’s sole nuclear plant and to clarify the future of its Russian-led expansion, which has suffered years of delay.
The previous Orban administration, which had handed a deal to Russia to add two reactors at its Paks plant more than a decade ago, had also dangled energy deals for the US months before the election, including the potential purchase of 10 US SMRs with an estimated value of $20 billion.
Westinghouse Electric Co. has also signed a memorandum of understanding to supply nuclear fuel to Hungary’s Paks plant and to use its technology to extend its lifetime.
The US would help to facilitate lining up financing for a potential nuclear deal, including via its Export-Import Bank or other US official lenders or financing institutions, according to the framework agreement. It calls for parties to conduct a market analysis for SMR technologies within a year of the agreement’s entry into force.
Dozens of companies are developing the next wave of nuclear technology, based on new designs. Many are focused on SMRs, which are expected to be built in factories and assembled on site, a strategy aimed at reducing costs and accelerating construction. Still, the technologies remain unproven and the industry needs to prove their commercial viability.
Source: Bloomberg