Soaring Electricity Prices Hit Hungarian Rail Freight Sector

  • 24 Jun 2022 6:33 AM
  • Hungary Around the Clock
Soaring Electricity Prices Hit Hungarian Rail Freight Sector
Hungary could miss an EU target in increasing the role of the rail freight industry in transport as costs have surged due to rising electricity prices, 444 reports.

In 2011, the European Commission set a target of shifting as much as 30% of road freight to rail or waterborne transport by 2030 for goods transported further than 300km.

Electricity prices on lines managed by state railway company MÁV have become so expensive that it is cheaper to transport consignments from Serbia to Slovakia through Croatia, Slovenia and Austria than transit through Hungary.

High electricity prices and track access charges have seriously dented the competitiveness of rail cargo companies operating in Hungary.

The EU approved relief measures during the pandemic, allowing states to lower or waive track access charges temporarily. Unlike Germany or Hungary’s neighbours, the government did not make use of this option.

Rail cargo companies drew up their business plans based on electricity prices of Ft 93 per kWh, but MÁV bought electricity at Ft 120-130 per kWh in December for the first quarter.

Since then, prices have risen further to Ft 170 per kWh, translating to huge losses for rail cargo companies.

Gysev, on the other hand, sealed a contract in mid-2021 for 2022 electricity prices at Ft 42 per kWh.

Sources told 444 that the botched electricity contract led to the firing of MÁV CEO Róbert Homolya last month.

MTI Photo: Zoltán Máthé

  • How does this content make you feel?

XpatLoop Media Partner

Hungary Around the Clock

Since 1995 Hungary Around the Clock has proven to be one of the most comprehensive sources of daily English-language news about Hungary. It covers ongoing domestic politics and foreign relations, as well as business and economic matters. For a free trial of HATC visit and click on 'Free Trial Subscription’.

Explore More Reports

  • Hungarian Train Drivers Refrain from Strike Because of War

    Hungarian Train Drivers Refrain from Strike Because of War

    • 16 Mar 2022 8:17 AM

    The Engine Drivers Union has desisted from going on strike as planned from March 10, citing the extension of humanitarian assistance to the growing number of refugees from the Russian-Ukrainian war, the union announced.