Interview with Mr. László Fazekas, Deputy CEO of MVM Group, Hungary

16 Dec Interview with Mr. László Fazekas, Deputy CEO of MVM Group, Hungary

Hungary’s power sector is undergoing rapid transformation. In 2025, renewables met 100 percent of domestic demand for the first time, while nuclear and coal continue to anchor the energy mix. Which trends or milestones best reflect the sector’s current momentum? What developments do you believe hold the greatest potential for the future? 

We expect power consumption to grow with increasing speed, at an average annual growth rate of three percent for the coming years, which is double the pre-2022 rate. The increasing demand for electricity is similar to what other European countries are experiencing, which means a lot of work for MVM Group in expanding regulated infrastructure and electricity generation.

We also foresee an expansion of renewable energy generation capacity. In recent years, we have seen a revolution and a democratization of photovoltaic power generation, particularly in Hungary. Today there are more than 300,000 power plants in Hungary, including household and industrial photovoltaic systems. In 2024, 25 percent of Hungarian power generation is from photovoltaic, putting Hungary among the top-10 in the world. Over 290,000 household photovoltaic systems are already in operation, mostly installed on rooftops on family homes. This has been supported by state-sponsored schemes that have fuelled this growth and Hungary is now very well advanced in its energy transition. Wind power has recently become feasible in Hungary and our first generation is set to be installed in 2029.

We are also focused on nuclear energy, which will remain part of the future energy mix. Hungary has one operational nuclear power plant, located near a town called Paks, and is part of MVM Group. This one plant is the backbone of Hungary’s power generation capacity and produces almost half of all domestic electric generation. One of the group’s greatest undertakings is the extension of the lifetimes of this power plant’s four blocks, which are set to expire between 2032 and 2037. The Hungarian government has already approved projects that will extend these by 20 years, to between 2052 and 2057. This will be a huge project and will be one of the MVM Groups biggest reconstruction and development projects. This means we can guarantee Hungary’s supply of nuclear energy, which will be essential in helping to reach Hungary’s carbon emissions reduction targets. Nuclear energy will remain an integrated part of the power mix in the coming decades. We are also expanding capacity at the Paks Power Plant by adding two more blocks, although this project is being undertaken by a different state-owned company and the new blocks will not be part of MVM Group.

All this puts Hungary in a very good position to meet its decarbonization targets, far ahead of other East-European countries. We have just one operational coal-fired power plant, located in the Mátra mountain range which will be phased out by 2029 and replaced with a combined-cycle gas-fried power plant, after which we will build any more coal-fired capacity. Decarbonization and the addition of new energy sources presents one further challenge: expansion and development of the electricity grid. This is a similar experience to other European countries, which are facing the same challenge of strengthening and modernizing transmission and distribution networks in order to integrate all this new renewable power generation.

Could you give us a brief overview of MVM Group’s current structure and operational reach including historical milestones and strengths that have positioned MVM as a resilient energy leader in Central Europe?

We are a 100 percent state-owned company, the second-largest in the country by sales and sixth-largest in Central or Central-Eastern Europe. Our key markets are Hungary and the Czech Republic, where we own Ideona Group with a local natural gas retail company. In all, we are present in 24 countries and we help supply affordable energy to around 11 million customers in Central and Eastern Europe.

MVM Group started its growth journey in the early 2010s. Our first acquisition was in 2013, when we entered the Hungarian natural gas market by acquiring the gas wholesale and storage business of E-on Group here in Hungary. Since then, we have gradually increased our regional presence as well as our domestic position and now have a dominant position in almost all elements of the power and natural gas value chain.

In Hungary we have market-leader positions in power generation, transmission, distribution, wholesale and retail, as well as distribution, wholesale, storage and retail for natural gas. Every household in Hungary is supplied by MVM Group’s energy. We are a partner of the Hungarian government in realizing the country’s energy goals and strategy.

The landmark 1,000 MW combined cycle gas turbine plant in Tiszaújváros is set to become Hungary’s most efficient large-scale power facility. What impact do you expect this plant to have on national energy capacity and operational efficiency?

The combined cycle gas turbine development project is the flagship project of MVM Group for the coming years. We have one project in the Mátra location to phase out that power plant and another one at Tiszaújváros to build two 530 megawatts blocks, which will be the most efficient gas turbine blocks in Hungary. It is essential to have highly efficient and flexible generation units as part of our power generation mix, because it would not be safe to rely only on nuclear power and renewables. So these power plants will be an integrated part of MVM Group’s and Hungary’s future power mix.

We have already finished the public procurement process for the main part of the project and we worked with Ansaldo Energia from Italy and Çalık Energy from Turkey as the consortium that won the public procurement. This whole investment supports Hungary’s green transition strategy and will help phase out the lignite-based plant, reduce carbon emissions and help integrate independent renewables in Hungary. We are at the end of the public procurement phase, the contract was signed in April 2025 and once the final investment decision is made this autumn, we plan to finish the construction phase by 2029.

In line with Hungary’s goal to reach 1 GW of electric energy storage by 2030, MVM has launched a NAS™ battery project. The initiative marks a bold step to-ward long-term energy autonomy. What role will these storage systems play in strengthening Hungary’s energy independence? 

We are seeing continuous increase in the demand for energy storage across Hungary and Europe, where power markets have seen extreme price fluctuations. During the day, photovoltaic sources produce so much energy that sometimes there are negative prices because of oversupply, while in the evening demand raises prices considerably. Storage facilities can help mitigate these extremes in supply and demand and help to store power generated during the day for when it is needed. That is why storage is becoming more and more central to our development strategy. There are many technologies to apply and several different projects to execute to realize these plans. One of these involves lithium batteries and sodium-sulfur technology. We believe it would be best to have a healthy mix of these different technologies. The advantage of the Sodium sulphur technology is that it is made from low-cost materials that can be easily sourced, unlike lithium.

MVM is expanding globally with a stake in Azerbaijan’s Shah Deniz field and partnerships like MOL on oil diversification which are poised to attract foreign investment. What, in your experience, defines a successful partnership in today’s evolving market and which areas of MVM’s portfolio present the most promising opportunities for international partners and investors, especially from the US? 

One of our important strategic targets is portfolio diversification, particularly supply source diversification. In the case of the supply of natural gas, Hungary is a landlocked country with no direct access to coastal energy terminals. The closest energy terminal to Hungary is in Croatia, where we already have capacity bookings. Our strategy is to gain more access to global energy markets to diversify our natural gas supply portfolio. The energy market is global in nature, with several important players, so we are looking for partnerships and opportunities for cooperation with global companies and those in the US.

As for portfolio diversification on the nuclear side, our current nuclear supplier is Rosatom from Russia. The Paks Power Plant was built using their technology in the 1980s. Our target is to have more and alternative fuel suppliers and we are working on forging partnerships with Westinghouse. Portfolio diversification also involves diversifying MVM Group’s finances. We have issued international bonds three times, two of which were dollar bonds, and we are looking for more investors on the financing side. We believe that MVM Group presents a very good investment opportunity for American investors, as a 100 percent state-owned utility company with an investment-grade credit rating.

What personal achievements are you most proud of since taking on this leadership position and what is your vision for MVM’s role in the region and what legacy do you hope to leave behind?

Personally I am grateful that I have been able to live through these changes and developments both in the energy industry and in MVM Group. The transformation of MVM Group from a classic state-owned company focused on the local market into a regional company leading an international energy transformation, means our strategy is to be the market leader in the provision of energy solutions in Central Europe by 2035. In this time we will also contribute to the decarbonization of the Hungarian energy sector and those of neighboring counties by leveraging our international investments.