Hungary draws down Russian loan for Paks

13 November 2017

Hungary will soon start accessing funds from a state loan extended by Russia to expand the Paks nuclear plant, Attila Aszódi, the state secretary responsible for the investment, told the Portfolio Energy Investment Forum conference in Budapest on 8 November, national news agency MTI reported.

Paks currently comprises four Russian-supplied VVER-440 pressurised water reactors, which started up between 1982 and 1987 and now account for about 50% of Hungary's electricity production.

Under an inter-governmental agreement signed in early 2014 Russian enterprises and their international sub-contractors are to supply two new VVER-1200 reactors at Paks (Paks-II) supported by a Russian state loan of up to €10bn ($11.2bn) to finance 80% of the €12.5bn project. Hungary received European approval of the project in March after the Commission determined that Hungary's financial support for the Paks II project met EU state aid rules. Russian state nuclear corporation Rosatom is responsible for the project, which that has been delayed by at least a year by negotiations with European regulators.

Payment of the first ten invoices submitted by Rosatom has already started, said Aszódi. The invoices were for a combined €98m, he added. The capital of project company Paks II Atomeromu will be raised at the same time as the first payment is made for the planning of the upgrade, Aszódi noted.

Russia’s Atomstroyexport (ASE – part of Rosatom), the general contractor for Paks-II, began a competitive procurement process for turbogenerators for the planned reactors in July. The procurement announcement was posted in Russian and English on the Russian nuclear industry’s official procurement website ( and a number of international sites. And earlier tender for a €771m contract to deliver turbines for the Paks reactors was withdrawn by ASE for “ technical reasons”.

Instructors for Paks-II will be trained at the Russia’s Leningrad NPP. Janos Tsitser, Director of Operations Management, MVM Paks-II said, during a recent visit to the plant: "Construction work for the site for the future nuclear power units should begin in 2018, but we are ready to discuss the issue of training our instructors at Leningrad NPP. We are currently talking about the training of 40 Hungarian specialists, who will then transfer the acquired knowledge to the staff of the Paks-II NPP, but in future, the number may increase to 50.

The basic permits for the construction of the two additional reactors at the Paks plant have already been received, and the units could start commercial operation in 2026 and 2027.

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