Background of the project

The direct background of the Paks II. project is that the Parliament recognizing the need for new nuclear power plant units, granting a consent for the preparation of new nuclear power plant unit(s) on 30 March 2009 with vast majority. (The Parliament adopted the motion with 330 votes in favour, 6 against and 10 abstentions.) This motion was strengthened by the National Energy Strategy accepted in 2011 which sets the direction of the next two decades’ development and operation. According to this the state intends to maintain the share of nuclear energy in domestic electricity production in the long run. 

The Parliament’s decision was based on the Teller project, when the MVM Group examined the feasibility of a new nuclear power plant. Following the decision, the program ran under the name of Lévai project.

For the establishment of the planned new nuclear power plant, an independent company called MVM Paks II. Ltd. was established on 26 July 2012. 

In the presence of Hungarian Prime Minister Viktor Orbán and Russian President Vladimir Putin, an intergovernmental agreement was signed on cooperation in the use of nuclear energy for peaceful purposes, which includes an agreement to build two VVER units at the Paks site. The bill proposal regarding this intergovernmental agreement was accepted by a vast majority in the Parliament (256 votes in favour, 29 against and 2 abstentions). This bill also sets the important goal of 40 percent of the project being open to Hungarian businesses. 

The Parties signed a loan agreement on 28 March 2014 regarding the financing of the project. The Russian Party will provide a state loan to the amount of maximum EUR 10 bn. to the Hungarian party for financing of the establishment of the two new NPP units. The Parliament approved of this agreement with a vast majority (110 votes in favour, 29 against and 19 abstentions). An important part of this agreement is that the Hungarian Party has the right to prepay any amount at face value and without additional charges. Our country has already used this right, thanks to the good performance of the Hungarian economy and its favourable international financial market position. 
On 9 December 2014 the implementation agreements were finalized, they contain the details of engineering, procurement and construction; they also contain the requirements of operation and maintenance and also the details of fuel supply. 

The Parties – MVM Paks II. Ltd. and the Russian Joint-Stock Company Nizhny Novgorod Engineering Company Atomenergoproekt (today it’s ASE Joint Stock Engineering Company) – signed a so-called turn key contract. This turn key model means the nuclear power plant will be delivered with every necessary equipment and accessories: with a fixed technical content, ready for commercial operation, with a fixed quality at a fixed price. The fixed price means the 12,5 bn EUR worth of investment won’t become more expensive, there can be no deviation from it. 

The contractual framework has been investigated for almost three years, then it was approved by the European Commission because it considered it to be in line with EU practice.
The company established for the construction and operation is called now Paks II. Nuclear Power Plant Private Company Limited by Shares (Paks II. Ltd.). The owner’s rights are excersised by the minister without portfolio responsible for the planning, construction and commission of the two new nuclear power plant units of Paks.