Hungary Ends Solar Net Metering

For years, Hungarian families were told rooftop solar was a sensible bet. Put panels on the roof, feed spare electricity into the grid during the day, and draw it back when the house needed it. The bill would be settled over the year. For many households, the grid effectively became a free battery.

Then the accounting changed. Under the new rules, households sell surplus solar power for roughly 5 HUF per kilowatt-hour but buy electricity back at 36 HUF inside the price cap, or up to 70 HUF above it (HVG, 24.hu). A seven-to-one gap is enough to turn a prudent household investment into a poor one.

Hungary's Constitutional Court has now rejected complaints against the change (HVG). That settles the legal point. It does not settle the more important political one: whether families and businesses can trust the rules of Hungary's energy transition. Budapest is preparing to push hundreds of millions of euro in EU money through the same system.

The old deal, and how it broke

The old "net settlement" system was straightforward from the household's point of view. A family could export solar power at noon and use electricity from the grid in the evening, paying only for the annual net difference. The arrangement hid the real cost of storage and grid balancing, but it gave households a stable basis for investment.

The new "gross settlement" system prices exports and imports separately. That is a defensible policy shift in principle, because electricity produced at midday is not worth the same as electricity consumed after dark. The problem is the spread: the export price is only a small fraction of the retail tariff.

More than 320,000 household solar systems face the transition as older protected arrangements expire (Portfolio). Some owners have been fined for apparent exports to the grid in areas where feed-in was restricted, even though changed metering logic may have produced the readings. The rules moved first. The penalties arrived at household level.

Cheap household power shifts costs to firms

The solar row has exposed a wider weakness in Hungary's electricity model. An investigation by Telex/G7 described opaque tariff calculations, no published data showing where the grid can absorb new generation, and state-linked energy groups operating across production, networks and retail in a system outsiders cannot properly test (Telex/G7).

Hungarian households pay about 9.8 euro cents per kWh, around a third of the EU average, because price caps have been kept in place since 2013 (KSH). That looks good on the kitchen table. It looks different from the factory floor.

The cost has not disappeared. Industrial users and small businesses face cross-financing charges that leave them paying well above many EU competitors (Telex/G7). Companies can live with these costs where the state or regulated tariffs ultimately absorb them, but that weakens the pressure to run the system efficiently.

€700 million through a narrow gate

Around 540 billion forints in EU-backed calls are now open for grid upgrades and smart-meter projects (Portfolio). The money comes through Hungary's revised plan under the EU's Recovery and Resilience Facility, the post-Covid fund that reimburses member states after agreed reforms and investments are completed. The energy chapter is worth more than €700 million, with about €643 million set aside for electricity networks (Telex).

No money can be paid until Budapest meets 27 "super milestones" on judicial independence, anti-corruption and protection of the EU budget (European Commission). Hungary has not yet submitted a payment request. The government needs the investment and the reimbursement, but the rule-of-law conditions leave a familiar temptation: spend quickly now and deal with governance later.

The calls are open to the transmission operator MAVIR and six distribution licensees, including E.ON and MVM network companies. Households, independent developers and new entrants cannot apply. If tariff formulas remain opaque and grid connections are allocated without transparent rules, EU money will enlarge the regulated asset base of network operators without necessarily making access fairer.

The investment case is real — and so is the access problem

Hungary's grid does need money. It cannot easily absorb what has already been built. The EBRD has committed €70 million as part of a €210 million package for a 450 MW solar-plus-storage project, describing it as one of the first project-financed hybrid renewable assets in Central and Eastern Europe (EBRD).

The regional problem is plain enough. Romania showed it last week, when solar covered about 40% of daytime generation before vanishing in the evening and pushing spot prices above €1,000/MWh (Digi24). Without storage and stronger networks, solar floods the system at noon and leaves buyers exposed after dark.

The Netherlands offers a useful comparison. The Dutch are ending their own solar netting rules by 1 January 2027, with household costs expected to rise from about €770 to €1,030 per year (Essent, Zonneplan). That transition is painful too, but it comes with published grid-capacity data, transparent queue rules and regulated connection timelines. Telex/G7 found no equivalent public data in Hungary (Telex/G7).

Hungary's grid problem is real. So is its access problem. EU payment conditions and tender design could still force more transparency, but the current structure does not guarantee it. For households that bought panels under one set of rules and are now living under another, that is the part of the story that will matter most.