Management of the Hungarian Energy Office - Magyar Energia Hivatal

Hungarian Energy Office
Report on the activities of the Hungarian
Energy Office in 2009
Budapest, December 2010

Published by:
Magyar Energia Hivatal
(Hungarian Energy Offi ce)
H-1081 Budapest, Köztársaság tér 7.
Telefon: +36-1-459-7777
www.eh.gov.hu
Responsible Publisher:
Péter Horváth President
Editors:
Ernő Barka
Tibor Bartha
Orsolya Halmai
Tamás Szabó
Csaba Vigassy
Editorial Board:
dr. Ilona Ábrahám
Mariann Berg
Zsolt Birinyi
Ágnes Fuchs
Lajos Kerekes
Anikó Kertészné Tóth
Tibor Kovács
Tamás Kőrösi
Andrea Mörcz
Csaba Oberczán
Tamás Tóth
Árpád Vajdovich
Printed by:
e-Print Magyarország Zrt.
Manager:
Ákos Oravecz
Budapest, 2010
ISSN 1418-7299

Dear Reader,
The regulation of the energy sector has undergone signifi cant changes and yielded
many results during the past fi fteen years. The Hungarian Energy Offi ce (hereinafter
HEO), established in 1994, is one of Europe’s oldest regulator offi ces and is a defi ning
strategic character of the gradual market opening process leading from a regulated market
through a hybrid market – where the public utility and the free market segment operated
simultaneously – to the full market opening.
The gradual liberalization was launched on 1 January 2003 for the electricity market and
on 1 January 2004 for the natural gas market, the laws on the complete market opening
came into force on 1 January 2008 for the electricity industry and on 1 July 2009 for the
natural gas industry. After the full market opening residential consumers who do not wish
to take advantage of the possibility of trader switching may stay with the universal service
provider at an administrative price containing a maximum margin.
During the past one and a half decade the HEO has been continuously performing its
main tasks, namely the regulation of national electricity and gas companies as well as of
companies generating electricity by cogeneration, the protection of consumers’ interests
and the informing of stakeholders and the public. It also cooperated in the development of
the legal framework – acts and secondary legislation – of the energy sector.
In the fi rst period of its operation development and supervision of the regulated market,
price regulation, price application and consumer protection were the primary tasks of the
HEO. In the years after the opening of the energy markets supporting consumers to enter
the free market, analyzing market operation and refi ning legal and economic regulation
were of high priority for the HEO. Later market surveillance, market monitoring,
supporting a more effective and clear competition and ensuring a non-discriminatory
network access to the monopoly pipeline infrastructure came into the limelight. The new
regulation regime, the attendance of the competitive market and later the full market
opening has signifi cantly increased the number of tasks of the HEO.
From 2009 new tasks arose in the HEO’s activity, namely issuing the documents of origin
for electricity generated from renewable energy sources or waste, and from 1 July 2009
the consideration of initiatives of district heat suppliers for price modifi cation requests
regarding residential district heat prices. On the other hand, a signifi cant part of consumer
protection tasks – all consumer complaints on accounting, billing, payments or measuring,
disconnection and reconnection of electricity supply and district heat supply – were
remitted to the authority of the Nemzeti Fogyasztóvédelmi Hatóság (Hungarian Authority
for Consumer Protection).

During its existence the HEO has evolved fair professional cooperation with the consumer
organizations and the representatives of the energy industry. Its relations with other
bodies of public administration have been effi cient. It keeps continuous cooperation with
the energy regulatory authorities of the EU member countries and with their European
associations – like CEER (Council of European Energy Regulators), and ERGEG (European
Regulators Group for Electricity and Gas). The HEO takes part in the work of ERRA
(European Regulators’ Regional Association), the professional association of energy
regulators from several countries of Central and Eastern Europe, Asia and the Middle
East.
It is the fi fteenth time that the dear Reader may hold this publication assessing the activities
of the HEO. The detailed technical and economic data of the supervised sector might be
found in electronic form on our homepage www.eh.gov.hu.
The HEO was directed by Mr. J. Ferenc Horváth until September 2009, then by Mr. dr.
Zoltán Matos until the end of June 2010. We would like to thank them for their committed
professional work.
Budapest, December 2010
Horváth Péter
resident

Table of contents
SUMMARY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
NETWORK ENERGY MARKET REGULATION (LICENSING AND PRICE REGULATION) . . . . . . . . . 9
LICENSING. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Electricity sector . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
Natural gas sector . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
District heat production . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
PRICE PREPARATION AND PRICE REGULATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
Electricity and natural gas . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .10
District heat supply . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
CONSUMER PROTECTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
ENERGY SAVING, ENVIRONMENTAL PROTECTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
ENERGY INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .11
PUBLICITY AND INFORMATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
CLAIMS AGAINST HEO’S RESOLUTIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
REGULATION AND OPERATION OF THE ELECTRICITY MARKET . . . . . . . . . . . . . . . . . . . . . .12
REGULATORY ISSUES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
LICENSING AND SUPERVISION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Licensing procedure for small power plants and the scheme of feed-in obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Licensing of wind power plants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Inspection of power plants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
Licensing and inspection of the transmission network company. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Licensing and inspection of distribution companies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
Licensing of electricity traders and universal service suppliers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Licensing for organised electricity market . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
Allocation of cross-border capacities and congestion management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .14
Regulation of responsibilities of the transmission system operator and distribution network companies . . . . . . . . . . . . . . . . . 15
UNBUNDLING OF ACTIVITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
Requirements for unbundling in the Hungarian electricity industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
COMPETITION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
WHOLESALE MARKET . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
MARKET EVENTS AND CHANGES IN REGULATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
Characteristics of the retail market . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
MEASURES TO PREVENT ABUSE OF MARKET POWER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
SECURITY OF SUPPLY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .21
SECURITY OF ELECTRICITY SUPPLY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Preparations for winter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
Network development . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
PRICE PREPARATION AND PRICE REGULATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
ELECTRICITY AS PRODUCT (UNIVERSAL SERVICE) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SYSTEM USE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
ELECTRICITY UNDER FEED-IN OBLIGATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
REQUESTS ON PRICE REVIEWS AND PRICE MODIFICATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
TRADING MARGIN CAP AND INCENTIVES OF QUALITY OF SUPPLY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
PUBLIC SERVICE OBLIGATION AND CONSUMER PROTECTION . . . . . . . . . . . . . . . . . . . . . . . . . . 26
APPROVAL OF CODES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
SERVICE QUALITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
BREAKDOWNS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
RELIABILITY OF ELECTRICITY SUPPLY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
CONSUMER COMPLAINTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
REGULATION OF THE NATURAL GAS MARKET AND ITS IMPLEMENTATION . . . . . . . . . . . 30
REGULATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
LICENSING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
ALLOCATION OF CROSS-BORDER CAPACITIES AND CONGESTION MANAGEMENT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
REGULATION OF THE RESPONSIBILITIES OF TRANSMISSION AND DISTRIBUTION COMPANIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
UNBUNDLING OF ACTIVITIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
QUALITY OF SUPPLY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33

COMPETITION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
WHOLESALE MARKET . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
RETAIL MARKET . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
SECURITY OF SUPPLY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
NATURAL GAS TRANSMISSION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .35
STRATEGIC NATURAL GAS STORAGE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
COMMERCIAL NATURAL GAS STORAGE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Determination of natural gas restriction order . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .36
Handling of the gas crisis of January 2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
PRICE PREPARATION, PRICE REGULATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
CHARACTERISTICS OF THE PRICE SYSTEM AND PRICE REGULATION FROM 1 JANUARY 2009 TO 30 JUNE 2009 . . . . . . . . . . . . . . . . . . . . . .37
CHARACTERISTICS OF THE PRICE SYSTEM AND PRICE REGULATION FROM 1 JULY 2009 TO 31 DECEMBER 2009 . . . . . . . . . . . . . . . . . . . . 37
WORKS IN RELATION WITH PRICE REGULATION, PRICE PREPARATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Profi t cap and profi t reimbursement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
Consideration of requests on price reviews . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .39
PUBLIC SERVICE OBLIGATION, CONSUMER PROTECTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
APPROVAL OF CODES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39
SERVICE QUALITY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
Interruptions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40
CUSTOMER COMPLAINTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41
REGULATION OF DISTRICT HEAT PRODUCTION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
REGULATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
LICENSING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42
Licensing activity of the HEO in 2009 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
COMPETITION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
SECURITY OF SUPPLY . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
PRICE PREPARATION, PRICE REGULATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 43
PUBLIC SERVICE OBLIGATION AND CONSUMER PROTECTION . . . . . . . . . . . . . . . . . . . . . . . . . . 43
ENERGY SAVING, ENVIRONMENTAL PROTECTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
ENERGY SAVING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
ENVIRONMENTAL PROTECTION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
USE OF THE RENEWABLE ENERGY SOURCES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
GREENHOUSE GAS EMISSION ALLOWANCE TRADING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46
OPERATION OF THE HEO, INSTITUTIONAL RELATIONS, PUBLICITY. . . . . . . . . . . . . . . . . . . 47
INSTITUTIONAL AND INTERNATIONAL RELATIONS, PUBLICITY . . . . . . . . . . . . . . . . . . . . . . . . . 47
BILATERAL INSTITUTIONAL RELATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
INTERNATIONAL RELATIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
THE ENERGY INTEREST REPRESENTATION BOARD (EÉT – ENERGETIKAI ÉRDEKKÉPVISELETI TANÁCS) . . .. . . . . . . . . . . . . . . . . . . . . . . 47
CONDITIONS OF OPERATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
FINANCIAL MANAGEMENT OF THE HEO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
INFORMATION TECHNOLOGY, INFORMATION PROCESSING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48
Information Technology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. 48
DATA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .49
1. NATIONAL ENERGY CONSUMPTION DATA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
2. INTERNATIONAL ENERGY CONSUMPTION DATA . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51
3. ACTIVITIES OF THE HEO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 55
4. DATA ON ELECTRICITY INDUSTRY SUPERVISED BY THE HEO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 56
5. DATA ON NATURAL GAS INDUSTRY SUPERVISED BY THE HEO . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 64
6. DATA ON DISTRICT HEAT GENERATION SUPERVISED BY THE HEO . . . . . . . . . . . . . . . . . . . . . . . . . 69
7. PRICES AND TARIFFS OF ELECTRICITY AND NATURAL GAS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .71
APPENDIX . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
LAW RELEVANT TO THE ACTIVITIES OF THE HUNGARIAN ENERGY OFFICE . . . . . . . . . . . . . . . . . . . . . . 81
DIRECTIVES AND REGULATIONS OF THE EU . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 84

Management of the Hungarian g Energy Office
Péter Horváth
President
Csaba saba Kovác Kovács
Vice-President
Csaba saba Vigassy Vigass
Head of Secretariat
Presidential Secretariat
dr. Gábor Ször Szörényi Gábor ábor Farkas Ms. Gabriella Ja Janota dr. László Hub Huber
Director
Directorate of Energy Supply
and Consumer Protection
Dr. Péter Grabn Grabner
Head of Department
Electricity Licensing
and Supervision
tván Balázs
István Balázs
Head of Department
Gas Licensing and Supervision
Director
Directorate of Pricing
and Economic Analysis sis
György yörgy Béké Békés
Deputy Director
Price Preparation
for Electricity
Mrs. Edit Fark Farkas
Head of Department
Price Preparation for Gas
Pál Lángfy Tamás amás Tóth
Head of Department
District Heating Licensing
and Supervision p
Gábor or Besseny Bessenyei
Head of Department
Consumer Protection
Head of Department
Economic Analysis
and Sustainable Development p
Tamás amás Szabó
Head of Department
Energy Information and IT
Director
Directorate of Finance
and Human Resources Resource
Mrs. s Anikó Tó Tóth
Deputy Director
Directorate of Finance
and Human Resources
Director
Directorate of Legal
and nd Management
Mrs. dr. r Ilona Áb Ábrahám
Head of Department
Directorate of Legal
and Management

SUMMARY
The foundation of the Hungarian Energy Offi ce (hereinafter
HEO) was ordered by the Act 41 of 1994 on Natural Gas
Supply. The present responsibilities of HEO are determined
by the Act 18 of 2005 on District Heat Supply (hereinafter
the District Heat Supply Act), the Act 42 of 2003 on Gas
Supply (hereinafter the old Gas Act), the Act 40 of 2008
coming into force in 2009 (hereinafter the Gas Act), the Act
86 of 2007 on Electric Energy (hereinafter the Electricity
Act) and the government and ministerial decrees issued on
the basis of these acts. The Act 67 of 2008 on Enhancing
the Competitiveness of District Heat Supply (hereinafter
District Heat Competitiveness Act) was issued in 2008, and
signifi cantly extended the circle of responsibilities of HEO
from 2009. HEO performed its tasks with regard to market
opening and market surveillance taking into account
Directives 2003/54/EC and 2003/55/EC, as well as 2009/72/
EC and 2009/73/EC of the European Parliament and the European
Council.
The Act 57 of 2006 on the Central Administrative Bodies, and
the Legal Status of the Members of the Government and of the
Secretaries of State defi ned that HEO is a governmental offi ce,
which was controlled by the Government and supervised by
the Minister of Transport, Telecommunication and Energy
in 2009. The Act was repealed by the Act 43 of 2010 on
the Central Administrative Bodies, and the Legal Status of
the Members of the Government and of the Secretaries of
State, but HEO’s legal status remained unchanged; HEO is
a governmental offi ce with independent responsibilities and
competences.
The key responsibilities of HEO have been since its foundation
licensing and surveillance of regulation of the activities of
network energy companies, consumer protection and the
preparation of administrative prices of electricity and natural
gas as well as approval of price applications. After full opening
of network energy market, the price of energy as a product has
been ceased to be regulated for the customers not entitled for
universal service. System operation and the use of lines and
pipelines being legal and natural monopolies, respectively, fall
under administrative price setting. With regard to electricity
and natural gas, the universal service supplier’s intent to
change prices of universal service has to be approved by HEO
in resolution in 2009. From July 2010 the universal supply
falls under administrative price setting.
After the full opening of the network energy market, there
have been changes in the role and activity of HEO. In addition
to the regulation of the activity of energy industry licensees,
other tasks tended to gain increasing importance like price
application, consumer protection and information supply,
also the surveillance of the competitive market, enhancing
competition, guarding and forcing fair competition, monitoring
the competitive market environment, and, if necessary,
changing or initiating changes in this environment.
annual report 2009
In 2009, HEO made 853 resolutions (including 388 on
licensing, 109 on consumer protection, 68 on price review,
134 on data supply and 154 on other issues), and proceeded in
1877 cases associated with consumer protection.
NETWORK ENERGY MARKET REGULATION
(LICENSING AND PRICE REGULATION)
The network energy market was fully regulated from 1994
till the end of 2002. On 1 January 2003, the gradual opening
of the markets started with the liberalization of the electricity
market, which was followed by the liberalization of the natural
gas market on 1 January 2004. In the fi rst step, only large
industrial customers, and from 1 July 2004 all non-residential
customers could enter the competitive electricity market.
Licensing
Electricity sector
The electricity market was characterized by a hybrid model
till the end of 2007. This corresponds to the co-existence of a
public utility and a free market segment. In 2008, the hybrid
model ceased to exist and was replaced by a competitive
market model. In the latter model, the competition can be
restricted only in the interest of the protection of vulnerable
consumers, or with a view to prevent the abuse of market
power. Customers and traders can purchase, and producers
can sell electricity under free market conditions, except for
the co-generated electricity and the electricity generated from
renewable energy sources. This electricity is not for free market
sales but to be compulsorily bought by the transmission
system operator at a supported price as specifi ed in the
Electricity Act (KÁT balance circle), then allocated among
electricity traders supplying end users in the proportion of the
electricity quantities they sell to end users.
Natural gas sector
The Directive 2009/73/EC of the European Parliament and
of the Council concerning common rules for the internal
market in natural gas and repealing Directive 2003/55/EC
(new Gas Directive), and Regulation 715/2009/EC European
Parliament and of the Council on conditions for access to the
natural gas transmission networks and repealing Regulation
1775/2005/EC (new Gas Regulation) were published on 13
July 2009. The provisions of the Regulation came into force
on 3 September 2009, while the provisions of the Directive
have to be implemented from 3 March 2011.
The preparatory works of the adoption of the provisions of the
new Gas Directive started as early as autumn 2009 similarly to
the new Electricity Act, and the experts of HEO participated in
the legislator work of KHEM.
annual report 2009 | 9

hungarian energy office
The Gas Act came fully into force on 1 July 2009. The new
act ceased hybrid model and public utility supply by this date.
The public utility segment has been replaced – similarly to
the electricity sector – by universal service to supply small
customers in the form of a new licensee.
2009 saw a signifi cant increase in the number of customers
entering free market, although the defi nition also changed on
1 July. The number of users leaving universal service grew
to 137 532 (including 2 527 non-household and 135 005
household customers) by the end of the year. The number of
licensed free market traders was 31 at the end of 2009. The
share of competitive market in the annual total natural gas
consumption amounted to 48.2%.
Public utility will fully cease by 30 June 2010. The obligation
of the non-household customers’ entering free market is
gradually enforced during the one-year transitory period. In
the transitory period, the following users are also entitled for
universal service:
• Users with capacity exceeding 20 m 3 /hour but below 100
m 3 /hour, until 30 June 2010 and
• users having district heat production specifi ed in a separate
act, until 30 June 2011.
District heat production
Both the production and the supply of district heat remained
activities subject to license, while the installation of a district
heat equipment is subject to license only over a heat output of
5 MW. However, the licensing competence is divided between
the municipalities of settlements and HEO. All district heat
producers that also generate electricity must apply for a
license to HEO, while the licensing of district heat production
without electricity generation falls under the competence of
municipalities.
PRICE PREPARATION AND PRICE REGULATION
Electricity and natural gas
In 2008, a new era started in the price regulation of electricity
supply with the ceasing of public utility supply and the
introduction of universal service. For customers not entitled
for universal service (large, non-residential customers) can
buy electricity only from competitive market traders at a price
evolved on the base of demand and supply of the market. (In
2009, there were 4 large and approximately 20 small electricity
trading licensees.) Small customers – unless they entered free
market – could continue buying electricity in the framework
of universal service i.e. at a price monitored by authority even
in 2009.
The feed-in obligation scheme is regulated by the Government
Decree 389/2007 (23.12) on Feed-in Obligation and Price of the
Electricity Generated from Renewable Sources or Waste, or Cogenerated
Electricity enforcing the provisions of the Electricity
Act. The generation of electricity sold in the framework of the
feed-in obligation scheme obtained signifi cant support also in
annual report 2009 | 10
2009 through the fi xed administrative prices, which are higher
than market prices.
In the fi rst half of 2009, the natural gas market was still
characterized by the ‘hybrid market’ model (co-existence of a
public utility segment and a competitive market). Accordingly,
customers choosing public utility supply (customers who do
not wish to enter competitive market) were able to purchase
the product (natural gas) by paying administrative prices
(public utility prices) for complex services, including both the
price of energy and the price of system use. Customers entering
competitive market were able to buy the energy at a nonregulated
price, while paid administrative charges for system use.
On 1 July 2009, each users with gas meter exceeding 100 m 3 /h
– except those having license for district heat production –
had to enter free market. If they failed to do this, they were
automatically transferred to their public utility supplier’s
competitive market trader.
As the consequence of model change in both sectors, the price
preparation activity of HEO is focused on monopole activities
remaining within the framework of administrative price setting,
i.e. on decrees on system use charges, and obligatory feed-in
prices and universal service prices in the case of electricity, and
universal service prices in the case of natural gas (starting price
of natural gas and price margin).
A new (four-year) price regulation period started in 2009 for
electricity system use, and in 2010 in the natural gas sector. The
preparation of the 2010 natural gas starting prices was preceded
by a detailed asset and cost review completed in 2009 and the
shaping of the price regulation scheme of the new period. (The
starting prices of electricity system use were prepared and the
price regulation scheme was established in 2008.)
District heat supply
In virtue of the District Heat Act modifi ed by the District Heat
Competitiveness Act, HEO has performed price control over
residential district heat prices since 1 July 2009. In 2009,
district heat suppliers submitted to HEO requests on residential
district heat price change with regard to 25 settlements. The
majority of the requests aimed to decrease charges. In 2009,
19 cases were closed by resolution including one initiating
price increase, which was rejected.
Consumer protection
In 2009, the HEO had 1877 cases related to consumer
protection. This case number is 2% more than in the previous
year. The insignifi cant rise is a result of the fact that while the
number of electricity complaints grew by 74%, the number
of natural gas complaints dropped by 23% due to sharing the
competence amongst HEO and the Nemzeti Fogyasztóvédelmi
Hatóság (Hungarian Authority for Consumer Protection).
65.1% of the complaints managed by HEO were direct
consumer complaints. Residential customers’ complaints on
settlement, billing, charge payment, metering, suspension

or disconnection from natural gas supply due to overdue
payment and reconnection to supply after the debt is paid have
been managed by Nemzeti Fogyasztóvédelmi Hatóság in the
whole year in the case of electricity, and since 1 July 2009
in natural gas sector. Accordingly, HEO transferred 328 such
complaints to Nemzeti Fogyasztóvédelmi Hatóság, on the
management of which the latter has competence. Complaints
were evaluated, resolutions were issued and measures were
taken continuously. As a result of the inspections conducted
on the basis of experience gained during the process of
consumer complaint management, HEO did not impose any
fi ne in 2009 but imposed in its resolutions other obligations
bound to deadline. If a licensee fails to meet those, a fi ne may
be imposed on it. For not meeting the obligations of quality of
service, HEO imposed a fi ne of 60 million HUF in only one
case.
In 2009, HEO conducted a consumer satisfaction survey for
the fourteenth time. In the opinion of approximately 10 000
electricity consumers and 10 000 natural gas consumers,
there were no signifi cant changes in the tendencies of the
previous years. The most critical fi elds were uninterrupted
supply, restoration of breakdowns, complaint management
and availability of Call Centers in both sectors. Construability
of bills was a source of several problems in both sectors.
HEO maintained active relations with other administrative
bodies working in the fi eld of consumer protection. An
especially intensive dialogue developed between HEO and the
Hungarian Authority for Consumer Protection. HEO provided
professional support in the management of the consumer
complaints diffi cult to be judged, the spheres of authority have
been clarifi ed as a result of modifi cation of several legal rules
and in accordance with HEO’s new resolutions on client service
quality, the formal and contentual requirements of data
supply obligation have been reregulated. HEO operated the
Energy Interest Representation Board (EIRB) also in 2009
with a view to ensure the continuity of the dialogue between
customers and licensees.
Energy saving, environmental protection
The HEO cooperated in the implementation of energy saving
and improved energy effi ciency strategy of the Government.
As an expert, it participated in the work of the inter-ministerial
commission evaluating tenders aiming at the improvement of
energy effi ciency, as well as in the work of the commission
evaluating tenders in the Environmental Protection and
Infrastructure Operational Programme. It also assisted in the
preparatory work of calls for tenders.
Energy information
The supply and the processing of technical and economic data
of licensees required by HEO for meeting its responsibilities
as well as the data supply towards international organisations
and co-authorities were continuous.
Publicity and information
annual report 2009
The President of HEO, in compliance with his task specifi ed
by the relevant law, submitted a report on the activities
of HEO in 2008 to the Government in 2009 as well. HEO
prepared its annual national report presenting the operation
of the electricity and natural gas markets in accordance with
the Directive 2003/796/EC and with the appropriate content
specifi ed in the Directive 2003/54/EC on electricity, and the
Directive 2003/55/EC on natural gas.
The HEO continuously supplied information to consumer
representative organizations on the issues of licensing, price
preparation, market analysis and market regulation through
the Energy Interest Representation Board.
HEO performs its data supply obligations towards international
organizations (EUROSTAT, International Energy Agency,
etc.) regularly including, among others, the most important
data of the electricity and natural gas sectors.
Experts of HEO played an active role in the various
organizations of the European Commission, as well as in its
professional committees, in the working groups of the Council
of European Energy Regulators (CEER), and of the European
Regulators’ Group for Electricity and Gas (ERGEG).
HEO issued its publication on the activity of HEO and the
key technical and economic data of the supervised sector, and
the Electricity Statistical Yearbook containing the data of the
electricity system also in 2009. The senior management of the
Offi ce regularly informed the written and electronic press on
consumer related issues.
On its homepage at www.eh.gov.hu, the HEO provides
information on its activities, its resolutions of public interest,
its announcements, and the main events of the energy market.
Claims against HEO’s resolutions
In 2009, in addition to the cases of consumer protection, HEO
made 853 resolutions. 27 of them were challenged at law
court. From among them, 4 cases were tried, and 23 cases are
still in progress. 49 lawsuits were carried over to 2009 from
earlier years. From among these cases, 24 were tried in 2009
and 25 cases are still in progress.
In 2009, HEO proceeded in 1877 cases associated with
consumer protection. Stakeholders contested the resolution of
HEO in 93 cases. From among these, 9 cases were tried and 84
cases are still in progress. 61 lawsuits were carried over from
the former years to 2009. From among these cases, 19 lawsuits
were tried and 42 cases are still in progress.
annual report 2009 | 11

hungarian energy office
REGULATION AND OPERATION OF THE ELECTRICITY MARKET
REGULATORY ISSUES
Licensing and supervision
In 2009, HEO issued 302 resolutions to electricity
undertakings. From among them, 43 were simplifi ed license
for small power plants and 53 were resolutions on license
modifi cations. HEO issued 30 trading licenses, 39 resolutions
on the approval or modifi cation of codes, approved 6 events
in relation with corporate law and 121 other cases, decided
to launch inspection in 10 cases and made 2 resolutions on
imposing fi nes.
Licensing procedure for small power plants and the scheme
of feed-in obligation
The Electricity Act specifi ed cases when a simplifi ed licensing
procedure must be conducted for small power plants of
capacity of 0.5 MW or above. Licensing was continuous in
2009.
The amount of the electricity to be fed in under feed-in
obligation (quota), the duration of the obligatory feedingin,
and the expiration date of the operational licenses must
be determined by HEO taking into account the international
commitments of Hungary on the share of renewable electricity,
the competitiveness of power generated from renewable
sources, the impact of the given technology on the balanced
operation of the electricity system, the ability of consumers to
pay, the position of the system operator, and the extent of other
approved supports. The electricity co-generated with heat has
also fallen under the scope of this regulation since 1 January
2008.
In accordance with Section (5) of Article 171 of the Electricity
Act, selling rights regarding sales of the electricity cogenerated
with heat falling under feed-in obligation, and not
regulated by any authority resolution on the determination of
the volume of the electricity falling under feed-in obligation
and the period of obligatory feeding in, will cease to exist
on 31 December 2010. In cases specifi ed in the Act, HEO
may determine the quantity of the electricity to be fed in and
the period of feed-in obligation for the period ending by 31
December 2015 at latest. In 2009, HEO issued 100 relevant
resolutions to small power plants.
Licensing of wind power plants
In 2009 HEO did not issue any new license in relation with
wind power plants.
The KHEM Decree 33/2009 (30.06) on the Conditions of the
Tender on the Establishment of Wind Power Plant Capacity,
the Minimum Content Requirement of Tender and the Rules
of Tendering Procedure was published on 30 June 2009.
annual report 2009 | 12
On 28 August 2009, HEO called for tenders on the right to
establish wind power plant capacity in total of 410 MW. The
deadline for submitting tenders was 1 March 2010. HEO
held a consultation on tendering on 14 September 2010, and
modifi ed the Tender Dossier on 28 September taking into account
the remarks made on the consultation.
Inspection of power plants
In the course of the inspections performed at power plants in
2009, HEO concluded that the required fuel reserves specifi ed
in legal regulations were available in all power plants, and in
several places reserves even exceeded the required quantity.
Maintenance was carried out upon different principles but
according to the schedule on all locations thus ensuring
reliability and availability.
In compliance with the relevant Decision of the European
Commission, MVM Zrt. terminated its long term power
purchase agreements with 4 power plants of the 7 affected
power plants, and concluded new agreements for a shorter
term.
In the course of the inspections, power plants presented their
electricity sales contracts concluded with electricity traders
after terminating their long term PPAs. Where it was possible,
contracts included ancillary services, as well.
In general, power plants have several-year contracts for fuel
purchases.
Power plants observed the regulations on environmental
protection, so the developments and reconstructions carried
out earlier made the power plants suitable for complying with
the strict norms, and no power plant had to be closed.

Reviewing the status of quality assurance, it can be claimed
that all of the power plants were operating quality assurance
systems. These systems are adapted and audited according to
the changes. Some of the large power plants have started the
development of an integrated quality controlling, environment
controlling, labor health and labor security system. Several
power plants have an integrated environment centered
controlling and quality controlling system.
Licensing and inspection of the transmission network
company
In Hungary, the obligatory provisions on the unbundling of
natural monopole activities (transmission system operation,
distribution) from other, competitive electricity sector
activities (generation, trading and universal service) are
included in the Electricity Act and its enforcement decree.
In 2006, the system operator was reintegrated into the state
owned MVM Zrt, which also performed generation and
commercial activities, and therefore Hungary switched from
the previous ISO (Independent System Operator) model to
TSO (Transmission System Operator) model. As a result of
the transaction, the transmission network became the property
of the system operator. MVM Zrt. created a corporate structure
in which the holding company coordinating the subsidiaries
does not perform any licensed electricity market activities. In
2008, as the single system operator in Hungary, MAVIR Zrt.
performed its licensed activity as an independent subsidiary
of MVM Zrt. Support functions that were centralized within
MVM Zrt. in 2007, e.g. IT, fi nance, accounting, etc. kept up
also in 2008. HEO paid and will pay a special attention to
the supply of services within the company group, and the
outsourcings – allowing cross-fi nancing.
MAVIR Zrt. was owned the licenses for system operation
and transmission network (as such, it was also the owner of
transmission network assets for being a subsidiary of the MVM
Holding). These two lincenses were replaced by one single
transmission system operation licence on 1 January 2008
by HEO on the basis of the Electricity Act. The license was
modifi ed twice in 2009 upon MAVIR’s request. First, annexes
to the operational license were updated by the resolution
191/2009, which was followed by a change in MAVIR’s
headquarter acknowledged in the resolution 469/2009.
annual report 2009
On 3 September 2009 when 2009/72/EC came into force,
MAVIR Zrt. operated as a subsidiary of a vertical integrated
company.
Since 1 January 2008, MAVIR Zrt. has been responsible for
operating and balancing the balance circle established for the
settlement of the electricity falling under feed-in obligation
(KÁT). The rules required to perform these activities are
specifi ed in the Governmental Decree 389/2007 (23.12)
on the feed-in obligation and feed-in price of the electricity
generated from renewable sources or waste, or co-generated
electricity, the Governmental Decree 109/2007 (23.12) on the
distribution of the electricity falling under feed-in obligation to
be conducted by the system operator and the determination of
prices applicable in the course of distribution and the Business
Conduct Rules of MAVIR Zrt. The latter one was approved by
HEO in its resolution 6/2009 on 14 January 2009 then in the
resolution 471/2009 dated on 23 July 2009.
In accordance with the provisions of the Electricity Act, a
special balance circle for the settlement of the electricity
falling under feed-in obligation (hereinafter KÁT) was
established on 1 January 2008. The balance circle manager
is the transmission system operator MAVIR Zrt.. After this
balance circle started operation in the fi rst half of 2008,
several KÁT producer submitted a complaint to HEO.
Similar problems did not occur in 2009 thank to changes in
legislation and to clearing several practices. However, there
are rules that brought signifi cant challenges to MAVIR Zrt.
in daily operation like among others ensuring liquidity and
avoiding inaccurate schedules of producers. With a view to
solve these problems, HEO made a proposal to the Ministry of
Transport, Telecommunication and Energy on the amendment
of the relevant effective decrees (Government Decree Nr.
389/2007 (23.12) on the obligatory feed-in and feed-in price
of electricity generated from waste or from renewable energy
sources, or by combined heat production (CHP) as well as
Decree of the Minister of Economy and Transport (GKM)
109/2007 (23.12) on allocation of electricity under feed-in
obligation by the TSO and on calculation method of prices
to be applied in allocation by sending a draft wording of
provision on 11 December 2009.
HEO started reviewing the required regulatory steps following
the coming into force of Directive 2009/72/EC and Regulation
714/2009/EC so that Transmission System Operator could
operate under conditions in accordance with the relevant
provisions from 3 March 2011.
Licensing and inspection of distribution companies
Since 1 January 2008, all of the six distribution network
companies has been operating as a part of vertically integrated
companies with legal unbundling in compliance with the
relevant provisions on legal unbundling of the Directive
2003/54/EC.
The Hungarian electricity regulation does not use (cannot
use) the exemption rule relating to 100,000 consumers, since
annual report 2009 | 13

hungarian energy office
currently all distributors have more than 100,000 connected
customers. Network assets are owned by the network
companies.
The communication of distribution licensees towards
third parties is not suffi ciently independent yet, however
the framework of legal unbundling induces a continuous
improvement in the fi eld. 2009 witnesses a much more clear
separation in structure and in management associating with
legal unbundling.
Legal unbundling decreases the importance of the unbundling
of accounting, because distribution licensees perform nonnetwork
activities only at an insignifi cant rate.
Each of the six distribution companies operating in Hungary
are owned by professional foreign investors. Three of them
are owned by E.ON, two of them are owned by RWE-EnBW
and one of them is in the ownership of EdF. On 1 January
2009, the share of German investors in the ownership of the
six distribution companies was 81.6 %, and that of French
investors 18.4%.
HEO did not issued any new licenses in 2009, and there were
no reason for amending any of the already existing ones, there
were no changes in licensees’ organisational structure and
operation in 2009 relative to the previous year.
HEO acting within its inspection competence conducted
inspection against two disribution licensees in relation with
breakdowns caused by the extreme weather condition in
January 2009. In the course of inspection HEO found that the
affected regions in the given period witnessed such weather
conditions accompanied by a large extent of ice accretion,
which resulted in physical demages in networks. Distributors
removed demages in such way as it was expected in similar
cases. However, HEO imposed penalty on licensees for
irregularities with regard to outsourced activity and failures
revealed in informing customers.
Licensing of electricity traders and universal service
suppliers
The amendments to the Electricity Act and the enforcement
decree of the Electricity Act changed the rules of licensing for
electricity trade in 2009 as well. Since 1 July 2009, HEO, in
line with the relevant section of the Electricity Act, has issued
operational licenses for electricity trade including licenses
for universal service suppliers for an indefi nite time period
contrary to the former 10-year defi nite time period. Those
applying for limited electricity trade license do not have
to attach the declaration of the regulatory authority of the
registered headquarter on the intent of the foreign regulatory
authority to cooperate with HEO in any possible authority
administration. Amendments to rules of the enforcement
decree of the Electricity Act on licensing further decreased
the number of documents to be submitted in the licensing
procedure.
In 2009, a total of 30 (including 13 limited and 1 simplifi ed)
licences for electricity trade were issued. There was not any
new application for universal service.
annual report 2009 | 14
Licensing for organised electricity market
Since 1 July 2009, in accordance with the relevant section
of the Electricity Act and similarly to licenses for electricity
trade, HEO has issued a license for the operation of organised
electricity market for an indefi nite time period contrary to the
former 10-year time period.
In April 2009, HEO issued a license to HUPX Magyar Szervezett
Villamosenergia-piac Zrt. (HUPX Hungarian Organised
Electricity Market Zrt.), the affi liate company of MAVIR Zrt.
for the operation of organized electricity market. HEO made
a condition to the effective start of operation, which was the
submitting to HEO the agreements concluded with the IT
supplier conducting the settlement and ensuring the operation
of the organised electricity market, and HEO’s approval on
the various codes specifi ed by legislation. These conditions
have not been fulfi lled by 31 December 2009 but negotiations
revived at the end of the year and the effective operation is
expected to start at the middle of 2010.
In November 2009, also the Power Exchange Central Europe
residing in Prague submitted an application for license for the
operation of the electricity market. The procedure was still in
process on 31 December 2009.
Allocation of cross-border capacities and congestion management
Legal background
Since 1 January 2008, the issues defi ned in the Regulation
1228/2003/EC have been detailed in the Commercial Code
on the basis of Section (2)h of Article 47 of the enforcement
decree of the Electricity Act.
With a view to implement Article 3 of the Regulation
1228/2003/EC, a 0.25 HUF/kWh transmission system
operation charge was imposed on the import from a country,
which is not a party to the contracts of the transmission system
operator.
Cross-border capacity allocation in 2009
MAVIR Zrt. and the cooperating system operators have
performed cross-border capacity auctions since 2003 at the
common intersections. When comparing the results of the
annual auction of 2008 and the previous years to the results
of the annual auction of 2009, the following statements can
be made. With regard to the available import capacities, there
was a signifi cant drop in transmissions from Slovakia to Hungary.
400 MW compared to the previous year’s 700 MW was
allocated already in the framework of a joint auction. With
regard to the import from Austria to Hungary, while 300 MW
baselaoad capacities were auctioned for 2008, there were 180
MW baseload and 120 MW peak capacities to auction for
2009. The potential import capacity from Romania to Hungary
grew from 100 MW to 150 MW by the commissioning of
the second cross-border line.

With regard to the export of electricity, the capacity available
for transmissions from Hungary to Croatia rose by 150 MW to
600 MW. There was a signifi cant drop in capacities available
for transports from Hungary to Austria. 100 MW baseload
and 50 MW peak capacities were allocated compared to
the previous year’s 200 MW baseload and 150 MW peak
capacities. However, there was a signifi cant rise in capacities
required for transmissions to Romania and Serbia; from 50
MW to 150 MW. There was no annual capacity auctioned for
transmissions from Ukraine.
Results of the annual auction were compensated to a
certain extent by capacities allocated at monthly auctions.
Accordingly, with regard to the most important Austrian and
Slovakian import, the quantity of monthly capacity grew by
average 70 MW and 200 MW, respectively, in 2009 compared
to 2008. With regard to export, the average monthly quantity
of Croatian export declined by approximately 70 MW.
On the Hungarian-Ukrainien intersection, the scheme of
unilateral monthly auction was maintained also in 2009, in
addition to which daily auctions were introduced in the second
half of the year. There were changes in the auction rules also
on the Romanian-Hungarian intersection, where joint auction
has been introduced with regard to each period. Accordingly,
long term – annual and monthly – auctions are held by the
Romanian system operator, while the daily auction is held by
MAVIR Zrt. since December 2009.
With regard to import directions, MAVIR Zrt. did not call
to auction on the determinant Slovakian intersection in
2008 because of the decreased available capacities and of
the already allocated capacities still reserved for 2008. As a
consequence, the settlement price for cross-border capacity
that emerged for 2008 was 16.79 EUR/MWh on the Romanian
and 12.17 EUR/MWh on the Austrian intersections. With
regard to 2009, settlement prices slightly decreased on the
Romanian intersections to 14.47 EUR/MWh, while the
Austrian settlement price grew moderately to 12.91 EUR/
MWh. (Certainly, these prices assume 100% utilization).
The situation in the South Eastern European region that
evolved in 2008 because of the extreme weather conditions
in 2007 (the extraordinary drough implied a signifi cant rise in
electricity import) ceased. Accordingly, while the settlement
cross-border price of the 2008 auction was 11.86 EUR/MWh
on the Croatian intersection and 8.95 EUR/MWh on the
Serbian intersection, settlement prices show a drastic drop for
2009 to 0.58 EUR/MWh and 1.88 EUR/MWh, respectively.
In December 2009, the annual auction for 2010 brought the
following changes. The changes in the amounts of capacities
relative to the previous years are as follows. The import
capacity from Austria decreased to 120 MW baseload (by 60
MW) and 120 MW peak, from Slovakia to 300 MW (by 100
MW), and increased to 200 MW (by 50 MW) from Romania.
The reason behind the falling import capacities from Austria
and Slovakia is that the transmission system operators of the
Central Eastern European region are planning to introduce a
annual report 2009
coordinated fl ow-based capacity auction in 2010, therefore –
in agreement with the regulatory authorities – they decreased
the amount of the annual capacities by 40% on the debit of
the monthly auctions (this practically means that the values
did not change but capacities will be allocated on monthly
auctions instead of the annual one).
With regard to export directions, there were not any change
in available transmission capacities to Croatia, Serbia and
Romania (allocated capacities are 600 MW, 100 MW and 150
MW, respectively).
Regulation of responsibilities of the transmission system
operator and distribution network companies
In 2009, there were not any legal changes in the responsibilities
of the distribution network licensees.
Unbundling of activities
Requirements for unbundling in the Hungarian electricity
industry
In 2009, there were not any signifi cant changes with regard to
the regulation of unbundling of activities.
annual report 2009 | 15

hungarian energy office
COMPETITION
In 2009, the operation of the Hungarian electricity market was
determined by the demand decreasing effect of the crisis and
the transformation at the end of 2008 of the previous system
that was based on long term PPAs concluded between MVM
and power plants. The basic elements of the regulation based
on the parallel operation of universal service and free market
has remained unchanged.
In 2009, the circle of customers entitled for universal service
was extended by an amendment in law in 2008. The Gas
Act passed on 9 June 2008 increased the limit for connection
capacity entitling for universal service to 3x63 A and extended
the right for universal service to given general government units specifi ed in a separate legislation, local governments,
Table 1 Share of regulated (public utility segment and universal service) and free
market consumption in total consumption (%)
Free market
2004 2005 2006 2007 2008 2009
20.0 32.8 36.7 21.9 64.4 60.0
Public utility 80.0 67.2 63.3 78.1 35.6 40.0
Table 2 Market share of domestic power plant companies (groups) in terms of
installed capacity (2007) and production (2009) 1
2
MVM
3
Electrabel
4
AES
5
RWE
6
Atel
7 EdF
Other domestic power plants
Total domestic power plant
Net import
Gross consumption
The 3 largest power plant
9 companies
HHI-index 10
annual report 2009 | 16
Installed
capacities
(MW)
863
8 846
-
5 433
Market
shares
(in terms of
capacity)
14%
4%
5%
-
1. Power plant companies in the Table correspond to investor groups owning
power plants. To be simple, we did not try to exclude power plant units
active in the market of ancillary services (e.g.. Dunamenti F, or AES Tisza
blocks)
2. MVM: Paksi Atomerőmű Zrt. (Paks Nuclear Power Plant), Vértesi Erőmű
Zrt. (Vértes Power Plant), Gázturbinás Erőműveket Üzemeltető és
Karbantartó Kft. (an Ltd. operating and maintaining gas engine power
plants)
3. Electrabel: Dunamenti Erőmű Zrt.
4. AES: AES-Tisza Erőmű Kft, AES Borsod Energetikai Kft.
5. RWE: Mátrai Erőmű Zrt.
6. Atel (Alpiq since 1 February 2010): Csepeli Áramtermelő Kft.
7. EdF: Budapesti Erőmű Zrt.
8. Total share of power plant investors having a market share of less than 5%
9. The three largest power plant companies calculated on the basis of
installed capacities (MVM, Electrabel, AES) differs from the three largest
ones calculated on the basis of production (MVM, RWE, AES).
10. Compensation values would be higher if available or the effectively
accessable capacity were taken into account, and lower if import
capacities were taken into account
11. Calculated based on gross installed capacity data (fi gures of 2007).
12. (Net) production of a given power plant company fed in into the network
devided by national gross consumption (fi gures of the year 2009).
8
Production
(TWh)
15.1
1.5
1.6
5.1
Market
shares
(in terms of
production)
46%
5%
5%
16%
3%
83%
11 12
56%
1 813
local government units performing public
tasks, legal entities of churches performing
public tasks and institutions maintained
by foundation, performing public tasks.
The extended circle of customers entitled
for universal service resulted in the fact that
several medium and small size customers
left free market by 2009. Therefore, the
share of the customers circle affected by
administrative price regulation shifted
from 36% to 40% of the total consumption.
(The structure of the decline in demand
also contributed to the decreased share
of free market consumption: the demand/
consumption of industrial customers
buying electricity typically on free market
dropped to a larger extent than that of
small and medium size customers opting
for universal service.)
The economic recession resulted in a
decline in electricity consumption of
approximately 5%. Decreased demand
was accompanied by a drastic fallback in
the output of domestic power plants (10%)
and by a signifi cant rise in net import. The
total share of domestic producers within
gross consumption dropped from 90% to
83%, while the share of net import within gross consumption,
which decreased temporarily to 10% in 2007-2008 compared
to 15-20% in the year subsequent to market opening,
approached 20% again in 2009.
There was a signifi cant change in the relative market position
of power plant investors: while the total production of
baseload producers (Paks, Mátra) slightly rose, production of
natural gas fuelled large power plants halved. Since the above
baseload producers constituted a part of MVM’s contracted
portfolio also in 2009, the MVM-focused nature of wholesale
market failed to change; majority of electricity required to
satisfy domestic consumption (near two thirds) was still sold
through MVM group to universal service suppliers and traders
supplying customers.

Wholesale market
The Hungarian generation market
showed a low concentration also in 2009,
using conventional tools for analysing
concentration. In the course of the
privatization of the power plant sector
between 1995 and 1997, the majority of
power plants belonging to the vertically
integrated state corporation (Magyar Villamos
Művek Tröszt) were acquired by
foreign strategic investors (Electrabel,
RWE, AES) (Table 2). The market share of the three largest
generators was 62% in terms of installed capacities and 56%
in terms of generation, while the Herfi ndahl-Hirshman Index
(HHI), which may vary between 0 and 10 000 and measures
the concentration of a market, would be somewhere between
1400 and 1800 depending on the calculation method, which
indicates a less concentrated, multi-participant market in
ordinary circumstances.
While the concentration is relatively low
in terms of power plant capacity, the
concentration is high in the wholesale market.
The reason for this is that the capacity
required for supplying end-customers was
contracted by the former public utility
wholesaler (MVM) in the years of the
privatization of the power plant sector
(1995 to 1997) through long term power
purchase agreements. Although the Act
70 of 2008 on certain issues of electricity terminated these
PPAs by 31 December 2008, MVM concluded new, 5-8-year
agreements with most of the affected power plants. Through
the new agreements, MVM Trade (hereinafter MVM) disposed
over approximately 40 to 50% of the total available capacity
of domestic power plants in 2009, which practically meant
that approximately 62% the generation
of domestic power plants (including
MVM Partner‘s long term purchases from
power plants) was sold through one single
company, the MVM (Table 3).
The structure of the electricity wholesale
market is different in the case of sales to
universal service suppliers and to traders.
Near three fourths of universal service
suppliers’ electricity purchases continue
MVM-PPA
2 Trader
Feed-in obligation
Other
to take place through fi xed channels and at regulated prices
due to HEO’s resolution on signifi cant market power. In November
2007, public utility suppliers concluded electricity
sales contracts (so called VEASZ) with MVM for four
years. The selling prices to universal service suppliers within
the framework of VEASZ were regulated by the resolution
839/2008 (30. 06. 2008) of HEO, while the selling prices
of universal service suppliers to the end-users are regulated
by the decree of the Minister of Economy and Transport
115/2007(19. 12) on the pricing of universal service of the
electricity market and the product packages to be provided
within the framework of universal service. In the universal ser-
2
MVM
Feed-in obligation
Other
2
Import
MVM
Domestic power plants
3
Other
2005
23.8
2.9
4.4
2.1
Electricity sales (TWh)
2006
23.6
3.2
4.5
2.0
2007
26.5
3.6
5.0
1.9
2008
annual report 2009
Table 3 Sales structure of domestic power plant companies
1
3
26.8
3.2
6.5
0.2
2009
19.9
5.0
7.4
0.3
Market
share
2009
61%
15%
23%
1%
1. Purchases by MVM Rt, MVM Zrt., and MVM Trade Zrt. (public
utility wholesaler prior to 2007) in the framework of PPAs and 5-8year
electricity purchase agreements. In 2008, license for public utility
wholesale ceased, MVM Trade Zrt. since then has had only a license
for trade. Purchases of MVM Rt, MVM Zrt, and MVM Trade Zrt. from
sources other than PPAs (e.g. sales of given large power plants in the
framework of feed-in obligation prior to 2007) are excluded.
2. Sales of power plants to traders include MVM Partner Zrt.’s purchases
from power plants.
3. Sales of power plants in the framework of feed-in obligation were
bought mainly by public utility suppliers and in a small proportion by
the public utility wholesaler prior to 2007 and exclusively by MAVIR
Zrt. since 2008.
Table 4 Purchase structure of pubic utility suppliers/universal service suppliers
2005
18.7
3.6
0.7
1
Electricity purchase (TWh)
2006 2007 2008 2009
17.7
3.7
0.9
22.9
4.4
0.8
10.5
2.3
0.0
10.4
3.1
0.5
Market
share
2009
74%
22%
4%
1. The Table contains the electricity amounts bought in order to satisfy
customer demand emerging only in public utility segment and universal
service, respectively. Public utility suppliers’ purchases in order to
satisfy distribution network losses (which were satisfi ed by MVM Rt./
MVM Zrt./MVM Trade Zrt. prior to 2007) are excluded.
2. Sales to public utility suppliers for satisfying distribution network losses
are excluded.
Table 5 Primary purchase structure of traders 1
2005
6.0
6.5
2.9
0.2
Electricity purchases (TWh)
2006 2007 2008 2009
7.7
6.5
3.2
0.2
9.9
5.1
3.6
0.2
11.9
14.3
3.2
4.5
15.0
9.2
5.0
6.3
Market
share
2009
42%
26%
14%
18%
1. Primary purchase of traders is the electricity deriving directly from
domestic power plants or import and from MVM as (the former) public
utility wholesaler. The Table excludes the (signifi cant) electricity
turnover of electricity traded among traders. Traders’ purchases exclude
the purchases of MVM Trade Zrt – vith a view to make possible the
comparison of the periods prior to 1 January 2008 and thereafter.
2. Traders’ import as indicated in the Table excludes the electricity that is
bought and sold abroad.
3. Prior to 2007, it includes primarily the balancing energy bought from
the system operator, and since 2008, it has included also the electricity
bought from the system operator in the framework of feed-in obligation.
vice segment characterised by administrative prices (though
its size is just a fragment of the public utility segment), the
dominance of MVM remained unchanged, as much as 74%
annual report 2009 | 17

hungarian energy office
(Table 4). The remaining purchases of universal service
suppliers were primarily covered by co-generated electricity
or electricity produced from renewable energy sources by
small power plants sold to MAVIR at administrative prices
and allocated on the affected suppliers.
The purchases of free market traders were not constrained
by law contrary to those of public utility suppliers; therefore
the structure of free market, which is much smaller than the
public utility segment and the dominance of MVM prevailed
purely to a limited extent, was much more heterogeneous.
However, MVM rapidly increased its free market sales in
2008 paralel to the increasing free market consumption, so its
role in supplying the traders who supply eligible customers
was continuously increasing. In 2009, the primary purchases
of traders (excluding trade between traders) essentially came
from four sources (Table 5). These are the import sources,
the electricity sales from power plant (and import) capacities
contracted by MVM, spare capacities of domestic power plants
MVM Trade
(former public utility wholesaler)
2.
Universal service
suppliers
3.
1.
Producers and import
9/b.
Customers entitled for
universal service
7/b. 7
not contracted by MVM and since 2008, the sales of energy
fed in by MAVIR in the framework of feed-in obligation. The
majority of the electricity purchased from primary sources (a
signifi cant part of which passes several traders) was sold on
the Hungarian retail market, and only a smaller proportion
was sold abroad.
In Hungary, there is an organized energy market (energy
exchange) but did not work in 2009; therefore electricity
trade was fundamentally conducted within the framework of
bilateral contracts. Electricity sales are illustrated on Figure 1
(transactions in relation with ancillary services are excluded).
annual report 2009 | 18
10/a.
4.
5.
10/b.
9/c
11/b, c,f
7/a.
Traders
Free market customers
(not entitled for universal service)
Figure 1 Transactions on electricity market
Majority of the production of domestic power plants was sold
through 5-8-year agreements concluded with the former public
utility wholesaler (MVM) (1), near a fourth of their production
(co-generated and renewable production) was bought by MA-
VIR in the framework of feed-in obligation at a fi xed price
specifi ed in decree (9/a). 15% of power plant production was
sold on the free market in the framework of short term (mainly
one-year) agreements (5). Typically, MVM’s agreements
with power plants are concluded for the period of 5 to 8
years. MVM sold nearly half of the electricity bought from
domestic power plants in the framework of 4-year framework
agreements, so-called VEASZs (long term electricity sales
contracts), at a regulated price specifi ed by HEO in its SMP
resolution to universal service suppliers supplying customers
entitled for universal service – at an administrative price (2-
3). In 2009, 40% of the domestic electricity consumption took
place through this channel characterised by authority price
regulation.
Co-generation and
renewable
producers
MAVIR
(system operator)
9/b.
9/a.
Export
11/a,e.
8.
MVM sold nearly the half
of the electricity it bought
from power plants to traders
through bilateral contracts
or through public capacity
auctions (4). Although
traders primarily based their
activity on import sources in
the fi rst year of the market
opening, the sales of power
plant capacities contracted by
MVM became the key source
of purchases for free market
traders in addition to import
(10/b) in a few years’ time
(after the initial excess import
capacities disappeared).
Signifi cant proportion of
primary trader purchases
went through secondary trade
within the trade sector (6),
before the electricity was
sold to users (7) or on export
markets (8). The sales
of electricity generated from
renewable energy sources or
co-generated with heat fall in a
special sale category (9/a-b). The system operator (MAVIR) is
obliged to purchase this electricity from the generators within
the framework of feed-in obligation (KÁT) at a price specifi ed
by law, and in an amount and within a period determined by
the resolution of HEO (9/a). Traders and universal service
suppliers are obliged to purchase the electricity sold within
the framework of KÁT in the proportion of their sales to users
(9/b, 9/c).
Market events and changes in regulation
The Decision 2008/C 223 of the European Commission which
closed the investigation initiated against Hungary in the

subject of state aids were issued on 4 June 2008. The Decision
concluded that power plants received illegal state aids through
the PPAs and requested the Hungarian authorities to end these
state aids. In order to execute the Commission’s Decision,
the Parliament passed the Act 70 of 2008 on certain issues
in assocation with electricity on 10 November 2008, which
provide for the ending of PPAs and oblige the affected power
plants to pay back the illegal subsidies.
On the effect of the actions of public administration following
the Decision of the Commission, MVM Trade Zrt. started
renegotiating the PPAs regarded as the source of state aids.
It concluded new, medium-term (5 to 8 years) product-based
contracts with the majority of power plants (except for Dunamenti
Power Plant, and AES Tisza Power Plant).
With renegotiating the agreements, MVM Trade
transformed its former PPA portfolio into a
smaller but more competitive one.
On 30 June 2008, HEO issued its resolution
739/2008 on signifi cant market power (SMP
resolution) in which it designated MVM Trade
Zrt. as an undertaking with SMP and imposed
auctioning obligation and price limit on MVM
Trade Zrt.. The resolution (which was amended
by the resolution 963/2008 in December 2008)
specifi ed three different price limits, two for the
sales to universal service suppliers in 2008 and
in 2009 (16.34 HUF/kWh and 15.60 HUF/kWh)
and one for the company’s total sales on the
wholesale market in 2009 (19.05 HUF/kWh).
annual report 2009
With a view to fulfi l its auctioning obligation with regard to
the year of 2009, MVM held an auction on 27 and 28 October,
on which primiarily 2009 products were sold. Quarterly and
monthly products were sold on quarterly auctions. The total
of electricity MVM sold on the yearly and the following
quarterly auctions was 9 TWh.
In April 2009, MVM made a proposal that it would sell yearly
products of 2010 on three auctions to be conducted at three
different dates instead of the former big single auction. HEO
approved the proposal, thus yearly products of 2010 were sold
on three auctions. Short term (quarterly and monthly) products
continued to be sold on quaterly auctions.
Characteristics of the retail market
The main peculiarity of the retail market is still the dual
structure prevailing even after the market opening in 2003:
the co-existence of an administrative and a free price segment.
However, the relative weights of the two segments have
considerably shifted since 2008. The public utility supply
at administrative prices, which any consumers could avail
of, was replaced by universal service in 2008, for which
a much narrower circle of consumers is entitled. In 2008,
only residential customers and customers with a connection
capacity not exceeding 3x50 A were entitled for universal service.
In 2009, 60% of end-users consumption took place in
free market, while 40% of end-users bought electricity at
administrative prices (in the framework of universal service).
Customers entitled for universal service are still supplied by
their former suppliers who now own universal service licenses.
The universal service suppliers is obliged to sell electricity for
and conclude a contract with the users entitled for universal
service at administrative prices.
Customers not entitled for universal service have already
purchased electricity from the free market (primarily the large
customers) or just entered the free market when the public
utility segment ceased (mainly medium and small customers).
I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV I II III IV
Figure 2 Changes in retail market shares of investor groups (2002 - 2009)
annual report 2009 | 19

hungarian energy office
Small customers forced to enter the free market after the public
utility supply ceased in 2008 usually stayed with their former
supplier who supplied these customers in the possession of a
trading license.
The companies with universal service license, which are E.ON
Energiaszolgáltató Zrt., Budapesti Elektromos Művek Nyrt.,
Észak-magyarországi Áramszolgáltató Nyrt. and Dél-magyarországi
Áramszolgáltató Nyrt., are interested also in the
operation of distribution networks through their subsidiaries
or joint ventures. Universal service suppliers are owned by
three multinational companies, E.ON, RWE and EdF, which
supplied customers not only through their affi liates entitled
to provide universal service, but also through their trading
subsidiaries established with a view to perform free market
activities. Thus, the total market share of these companies
within the total domestic retail market was very signifi cant,
approximately 77% even 6 years after the market opening in
2003.
Despite the strong market concentration, there were traders
entering the market, who also undertook to supply customers
in addition to their domestic wholesale activity. Among these
there are both multinational companies with several subsidiaries
in the region, and small domestic traders. In 2009, there were
Eurocent/kWh
300
250
200
150
100
50
0
Denmark
Germany
Italy
Ireland
Belgium
Austria
Netherlands
Luxembourg
Malta
Sweden
Spain
annual report 2009 | 20
Norway
Cyprus
Slovakia
Portugal
Hungary
United Kingdom
Slovenia
tariffs excluding taxes taxes
Czech Republic
Finland
France
Greece
Croatia
Turkey
Poland
Latvia
Source: EUROSTAT
22-24 traders operating on the retail market, whose owners
were fully independent from any of the domestic distribution
network companies. Their market share was approximately
23%, but only 17% excluding the traders belonging to MVM
group. Some of the traders were established to supply only a
given circle of customers, primarily a company group.
In 2009, the market share of the companies formerly being
public utility suppliers continued to decrease. However, their
market position is still very strong, since 95% of as much
as hundred thousand users supplied in the framework of
universal service (primarily small and medium size customers
not entitled for universal service) are supplied by the traders
of the three big incumbent suppliers. If the market position
of suppliers and traders are calculated according to the
consumption of their users instead of the number of the users,
this rate is much smaller: former public utility suppliers and
their joint ventures supplied 59% of free market consumption
in 2009. Figures clearly reveal that new traders continue to vie
only for large customers.
In 2009, domestic prices in comparison with the prices of the
European Union were in the middle range in the residential
customer segment; with regard to prices to be paid by large
industrial customers with consumption between 20 and 70
GWh, Hungary became one of the countries
consuming electricity at the highest prices in
2009. (Figures 3 and 4).
Romania
Lithuania
Estonia
Bulgaria
Figure 3 Comparison of electricity tariffs to be paid by residential users in the
EU27 (2500 – 5000 kWh annual consumption; fi rst half of 2009)
Eurocent/kWh
200
180
160
140
120
100
80
60
40
20
0
Denmark
Hungary
Slovakia
Malta
Germany
Cyprus
United Kingdom
Netherlands
Belgium
Italy
Ireland
Czech Republic
Latvia
Spain
tariffs excluding taxes taxes
Turkey
Croatia
Norway
Portugal
Luxembourg
Finland
Source: EUROSTAT
Figure 4 Comparison of electricity tariffs to be paid by non-residential users
with annual consumption of 20 – 70 GWh in the EU27 (fi rst half of 2009)
Poland
Lithuania
France
Greece
Romania
Slovenia
Bulgaria
Estonia
Sweden
Measures to prevent abuse of market power
The ex post authority tasks of competition
surveillance specifi ed in the Act 57 of 1996 on
Prohibition of Unfair and Restrictive Market
Practices governing the posterior investigation
and sanctioning of market abuses are performed
by the Hungarian Competition Authority (Gazdasági
Versenyhivatal, hereinafter GVH). The
ex-ante interventional rights specifi ed in the
Electricity Act, which aim to prevent market
abuses are exercised by HEO.
The Electricity Act applies special rules to avoid
market abuses. It introduced the regulatory
practice concerning licensees of signifi cant market
power, which, although new in the regulation
of the electricity industry, was already a known
tool in the telecommunications sector. The
Electricity Act and the associating enforcement
decree include detailed rules on the designation
of licensees as having signifi cant market power
and their treatment.
Within the framework of the new regulation,
HEO as a supervisory authority may impose
special additional obligations (e.g. selling
electricity on public capacity auctions, costbased
pricing, preparation of a bidding sample
etc.) on all licensees including both wholesale

and retail market players who, following a market analysis,
turn out to have signifi cant market power. The imposition
of obligations all served to prevent the abuse of market
power and enhance the effi ciency of competition. HEO,
in cooperation with GVH and relying on market analyses,
designates the licensees as having signifi cant market power
and imposes special additional obligations adjusted to their
market positions.
HEO regarded the termination and renegotiation of PPAs in
2008 as a signifi cant event from the viewpoint of competition,
therefore decided in September 2009 to launch a new SMP
procedure both on wholesale and on ancillary services.
SECURITY OF SUPPLY
Security of electricity supply
Preparations for winter
HEO assessed the preparedness of licensees participating in
electricity supply and the expected level of security of supply
taking into account the below terms:
a) Implementation of the annual planned maintenances and
developments (plan and fact fi gures),
b) Ensuring fuels required for the production expected in the
winter months, according to fuel types,
c) Availability of reserves specifi ed in GKM Decree 44/2002
(28.12) on the least measure of the stockpile of energy
carriers for power plants of 50 MW or above and on the
order of stockpiling,
d) electric capacity, electricity balance, availability of reserve
capacities,
e) availability of cross-border capacities.
annual report 2009
HEO examined and evaluated the preparations of licensees for
the winter period, and drew the following conclusions:
• The power plants accomplished their winter preparation
programs.
• The power plants accomplished their annual maintenance
programs till 15 November 2009.
• The supply of power plants with fuel is ensured by
contracts.
• All power plants for which the decrees prescribe the fuel
stockpiles possessed the required stock.
Gas restrictions due to the Russian-Ukrainien gas debate in
January 2009 resulted in the fact that power plants suitable
for oil fuelling had to switch to oil fuelling. The majority of
power plants was successful in switching, however, there
were some power plants that experienced technical problems.
In the period of oil fuelling, stocks were decreasing, which
referred to the fact that the oil could not have been replaced
everywhere at due pace. HEO used the experience gained in
the course of switching for the inspections of preparations for
winter.
In the winter period, the capacity balance of the Hungarian
electricity system can be regarded as reassuring if the import
capacities on the northern and eastern borders do not decrease
signifi cantly, and the export on the southern borders do not
increase signifi cantly. In this case, the available capacity is
suffi cient to satisfy the demand, and also the reserve capacity,
which is suffi cient according to the plans, is available. In
the cold winter period, however, natural gas disconnection
may occur in the case of the hydrocarbon fi red power plants,
therefore the cooperation between the MAVIR dispatch centre
and the MOL dispatch centre is a must. Though measures
were taken in order to prevent the coal from being winterkilled,
such an event cannot be fully excluded. A case like this
could hinder the generation of the Mátra Power Plant and a
quick measurement would be necessary to involve reserves.
Network development
The transmission system operator MAVIR Zrt. is responsible
for ensuring the long term and secure availability of the system
with its development, maintenance and operation activities on
the transmission network constituting part of the Hungarian
electricity system, in line with Hungarian and international
requirements and thus providing for the maintenance of the
domestic electricity supply at a European level. Within the
framework of network development:
annual report 2009 | 21

hungarian energy office
• By December 2009, the construction of a 400 kV
transmission line between Szombathely and Hévíz and
the extension of Hévíz substation was completed. The 400
kV new transmission line between Szombathely and Hévíz
on the one hand provides for the second support to the
400/120 kV substation in Szombathely required because
of the (n-1) criterion, and, on the other hand, increases the
transmission capacity from North to South-West within
the European electricity system, which enhances system
security not only at regional but also at European level.
• The establishment of the interconnection 2x400 kV
between Pécs (Hungary) and Ernestinovo (Croatia) is
in process, works have been completed according to
schedule, and the deliverance and acceptance is expected
in 2010.
PRICE PREPARATION AND PRICE REGULATION
Electricity as product (universal service)
A new era started in the electricity supply in 2008 with the
ceasing of the public utility segment, which was replaced by
universal service. The electricity for which residential and
non-residential small customers now appeared in separate
categories of the electricity as a product, of the use of the
network ensuring the delivery of the product to the customer
(system use) and of taxes and other items of tax nature.
Residential customers – unless they entered free market –
could purchase electricity also in 2009 within the framework
of universal service, which means that they continued to buy
the electricity at an administrative price.
In January 2009, universal service prices (prices to be paid
for the energy as product) were reduced by the price authority
by 1%. Taking into account the increased prices for system
use, the average price increase affecting users supplied in the
framework of universal service was 2.9 % in January 2009. In
2009, universal service prices of all the four universal service
providers rose twice (in July-August and in November). Two
universal service suppliers modifi ed (reduced) the prices for
universal service also from 1 January 2010. Including also the
latter, the price for the electricity (including system use) on 1
January 2010 (relative to 31 December 2009) to be paid by the
users supplied in the framework of universal service changed
by -3.1 to +1.9 % depending on residence (site).
Based on experience gained in 2009, signifi cant amendments
on price regulation to the decree on universal service came into
force by 1 January 2010 [KHEM Decree 44/2008 (31.12) on
the setting of universal service prices on the electricity market
and on the product packages to be provided in the framework
of universal service].
It was not justifi ed any more to take into account the price
of gas purchased by power plants to determine the costs of
the justifi ed electricity purchase costs of universal service
suppliers – considering also the purchase portfolio (the
signifi cantly decreasing share of gas fuelled electricity
annual report 2009 | 22
production) of MVM Zrt. providing for the majority of the
supply of universal service suppliers. Prices, price relations
and price changes of the Leipzig energy exchange (as the
most signifi cant energy exchange of the region) may serve as
a long term base (supplemented by a kind of index of rates) to
determine the justifi ed costs of electricity purchases. The aim
of the taking into account of prices of the Hungarian auctions
with relatively large electricity turnover is to map the currently
effective electricity purchase conditions.
The annual average value of the trading margin to be applied
by universal service suppliers was 1.9 HUF/kWh also in 2009,
although the level of their operational costs were growing due
to the increasing general price level and the extending circle of
legal obligations. With the justifi ed specifi c trading margin’s
remaining unchanged in 2009 (relative to 2008), suppliers
could realise a rising total margin – thank to the growing circle
of customers.
The regulation prior to 2010 provided for the case when the
universal service suppliers annual average trading margin
exceeds the ceiling specifi ed in statutory provision, however
excluded any provisions for the case when this trading margin
lags behind the ceiling. This ’shortage’ has been ended by
adopting a provision to the decree on universal service to
provide for the possibility of supplementing trading margin,
in virtue of which the sum adequate to the missing trading
margin (determined by HEO in a resolution) may be realised
in universal service prices in the following year.
Prior to 2010, there were not any regulation on the price ratio
of the controlled and the universal service tariffs. Taking
into account the interest of both customers and the electricity
system, controlled universal service tariffs may be maximum
70% of the price according to whole-day tariff since 2010.

Based on environmental considerations (facilitating
sustainable development on the long term), a separate tariff
was elaborated in 2009 for the electricity supply of heat pumps
(devices directly serving the operation of equipment using
heat from solar energy and other renewable energy sources
for supplying heat to buildings). The electricity at discounted
price both with regard to product price and the price for system
use may be bought (under specialised terms) by the beginning
of the heating season of 2010-11.
System use
The fourth four-year (from 2009 to 2012) cycle of price
regulation for electricity system use started on 1 January 2009.
The specifi c administrative prices for natural monopol
activities (transmission system operation, ancillary services,
distribution) were determined by the Decree of the Minister of
Economy and Transport (GKM) 119/2007 (29.12) on charges
for electricity system use. By virtue of domestic regulation
taking into account also the various international practices,
only those who receive electricity from the network have to
pay a charge for system use. Those who feed electricity in the
network (power plants) are excluded from this obligation.
HEO prepared in
2008 and published
on 31 October 2008 a
methodology guildeline
on price regulatory
scheme of the new price
regulatory period – in
accordance with Section
(5) of Article 142 of the
Electricity Act. This was
modifi ed by HEO ex
offi cio on 22 October
2009 – with regard to
the fallback (exceeding
5%) in the electricity
turnover in 2009 implied by the economic crisis and to a
few unavoidable correction revealed in the meantime by
the practice. HEO prepared charges for system use of 2010
accordingly, and proposed to the Minister the promulgation
thereof. Charges for system use effective from 1 January 2010
were published in the KHEM Decree 69/2009. (4.12) on the
amendment of the GKM Decree 119/2007 (29.12) on the
charges for electricity system use.
The sum of charges for transmission system operator and
ancillary services grew by 53.5% on 1 January 2010 (compared
to 1 HUF/kWh in 2009), but still was lower than the value of
2008. The growth above was resulted from 3 key factors.
• (Posterior) Price regulatory adjustments carried over from
the previous cycle ending by the year 2008;
• Signifi cant increase in the price of reserve capacities
(primarily secondary ones) of Dunamenti and AES Tisza
power plants entering free market because of the
termination of the PPA portfolio of MVM Trade Zrt;
annual report 2009
• Amendment in price regulation executed by HEO – in
association with the decline in electricity turnover.
Distribution charges dropped by average 0.4% on 1 January
2010 compared to 2009 (within this, values of changes varied
depending on voltage levels between -33% and +2%). Figures
above are explained by the infl ation-indexed increase of
charges covering fi x costs and the declined purchase cost of
electricity loss of distribution network.
An annual distribution charge of 1800 HUF (excluding VAT)
(in the case of a controlled tariff category only 600 HUF)
has been imposed even on the smallest consumption places
including also residential customers since 1 January 2009. The
costs that have been covered by the base charge since 2009
were covered previously by the consumption proportional
distribution turnover charge, so the increase in this charge was
lower than it would have been without it. In other words, the
introduction of the base charge did not mean an effective rise
in the costs, but induced a restructuring among the various
groups of customers.
System operation charges between 2008 and 2010 are shown
in Tables 6. a) – c).
6. a) Charges for transmission system operation and ancillary services (HUF/kWh)
and the changes thereof
In the case of user (customer)
connecting to distribution
network
Charge for transmission system
operation
Charge for ancillary
services
Total
Table 6 Aggregated electricity system use charges (excluding VAT 1 ) from 2008
From
January
2008
1.000
0.672
1.672
Tariffs
From
January
2009
0.577
0.423
1.000
From
January
2010
0.823
0.712
1.535
Electricity under feed-in obligation
Changes in tariffs
January
2009
-42.3%
-37.1%
-40.2%
January
2010
42.6%
68.3%
53.5%
The prices for the electricity falling under feed-in obligation
changed on 1 January 2009 and the prices for the co-generated
electricity changed on 1 October induced by changes in gas
prices.
The increase in the prices in January was varying between
2.25 and 6.6%. The signifi cant standard variation resulted
from the application of different price regulation formulas of
the various energy sources.
In October, the price of energy generated by gas fi red
cogeneration – simultaneously with the decrease in natural
gas prices on 1 October and according to the provisions of the
effective Government decree [389/2007 (12.23)] – decreased
by 9.88%.
annual report 2009 | 23

hungarian energy office
High voltage
connection
Connection to
high/medium voltage
transformer
Medium voltage
connection
Connection to
medium/low voltage
transformer
Low voltage
3
connection I.
Low voltage
connection II. (controlled)
Low voltage
4
connection III.
Average
There is a signifi cant standard variation (varying between
-2.86% and +4.1%) of feed-in price changes on 1 January 2010
– again, due to the different price regulation of the various
energy sources (prices of gas fuelled CHP decreased due to
a further decrease in gas prices in January, while the feed-in
prices of electricity from other CHP, waste and renewables
grew in line with the taking into account of infl ation in a
different measure). Changes in feed-in prices of gas fuelled
electricity production after 1 July 2009 is adequate to the
index of gas price change calculated in accordance with the
provisions of Government Decree 389/2007 (23.12).
There were not any signifi cant changes in other terms of
the feed in of electricity sold in the framework of feed-in
obligation at supported price in 2009.
With regard to wind power plants, which drew special
attention because of the keen interest and the diffi culties in
the operability of the system, HEO issued operational licenses
representing a total capacity of 330 MW, from which 176 MW
was in operation by the end of 2009. On the basis of the new
Act and the secondary legislation on its enforcement, further
similar capacities can obtain a license and connect to the
system of feed-in obligation only by tendering. Accordingly,
HEO, following the preparation and the publication of KHEM
Decree 33/2009 (30.06) regulating the terms of tendering,
called for tenders to establish new wind power plant capacity
annual report 2009 | 24
2
6. b) (Average) Distribution charges and average changes thereof
(calculated on the basis of similar quantity weights)
From
January
5 2008
0.709
1.842
3.606
6.425
11.605
4.750
10.367
6.845
Tariffs
From From
January January
5
6
2009 2009
0.969
2.247
4.275
6.260
13.601
6.357
12.070
8.046
1.017
2.647
4.230
6.338
13.647
6.325
12.705
8.001
From
January
6 2010
0.672
2.176
4.158
6.141
13.889
6.134
12.566
7.967
Remarks:
1. In the indicated period prior to 30 June 2009 20%, and 25% since 1 July 2009.
2. Excluding charges for distribution schedule balancing calculated with average quantity data according to categories.
3. In the case of contracted capacities not exceeding 3*50 A in 2008, and 3*80 A from 2009.
4. in the case of contracted capacities exceeding 3*50 A in 2008 and 3*80 A from 2009.
5. Calculated with quantity weights taken into account in the calculation of prices for 2009.
6. Calculated with quantity weights taken into account in the calculation of prices for 2010.
Changes in tariffs
January
2009
36.6%
22.0%
18.5%
-2.6%
17.2%
33.8%
16.4%
17.5%
January
2010
-33.9%
-17.8%
-1.7%
-3.0%
1.8%
-3.0%
-1.1%
-0.4%

6. c) Aggregated charges for system use (excluding VAT ) from 2008
Average tariff and tariff changes
In the case of connection to
transmission network
In the case of
connection
to distribution
network 4.5
3
High voltage
connection
Connection to
high/ medium
6
voltage transformer
Medium voltage
connection
Connection to
medium/low
voltage transformer
Low voltage
7
connection I.
Low voltage
connection II.
(controlled)
Low voltage
8
connection III.
Average
of a total of 410 MW. The deadline for submitting tenders is
1 March 2010.
Requests on price reviews and price modifi cations
From
January
8 2008
1.52
2.38
3.51
5.28
8.10
13.28
6.42
12.04
8.52
In 2009, HEO received ten initiations from universal service
suppliers on the change of prices. Five requests were approved
and fi ve were partly approved by HEO.
In May, all the four universal service suppliers submitted
request to HEO on price increase. The measure of price
increases included in the requests were different according
to suppliers. HEO, after examining the calculations attached
to the requests, made partially approving decisions in all
the cases (allowing price increases of 1.6-10.9%). The new
universal service prices came into force in July and August,
respectively, thus essentially ended the uniform price level of
residential electricity supply in Hungary.
In September, universal service suppliers submitted other
requests to HEO on price increase that were different
according to universal service providers. Universal servi-
From
January
2009 8
1.00
1.97
3.25
5.27
7.26
14.60
7.36
13.07
9.05
Tariffs (HUF/kWh)
1
From
January
2009 9
1.00
2.02
3.65
5.23
7.34
14.65
7.32
13.71
9.00
From
January
2010 9
1.54
2.21
3.71
5.69
7.68
15.42
7.67
14.10
9.50
annual report 2009
Average
2
tariff changes
January January
2009 2010
-34.3%
-17.3%
-7.6%
-0.1%
-10.3%
10.0%
14.6%
8.6%
6.2%
53.5%
Remarks:
1. In the indicated period prior to 30 June 2009 20%, and 25% since 1 July 2009.
2. Calculated with similary quantity weights.
3. Sum of the charges for transmission system operation and for ancillary services.
4. Sum of the average value of transmission system operation charge, the charges for ancillary services and the average value of distribution charges.
5. Excluding charges for distribution schedule balancing.
6. In the case of contracted capacities not exceeding 3*50 A in 2008, and 3*80 A from 2009.
7. In the case of contracted capacities exceeding 3*50 A in 2008, and 3*80 A from 2009.
8. Calculated with quantity weights taken into account in the calculation of 2009 prices.
9. Calculated with quantity weights taken into account in the calculation of 2010 prices.
9.4%
1.7%
8.9%
4.7%
5.3%
4.7%
2.9%
5.6%
ce prices coming into force on 1 November based on three
approving resolutions (DÉMÁSZ, ELMŰ, ÉMÁSZ) and one
partially approving resolution (E.ON) were higher by 2.2% to
10.2% on the average than the prices effective since July and
August, respectively.
Price increases required for reaching the trading margin
specifi ed in legislation were justifi ed in all cases mainly by
the share of electricity under feed-in obligation (within total
consumption) increased relative to 2008 and by price level
that was higher than in the previous year (due to gas pirce
increases in 2008).
The difference in the measure of price increases is explained
primarily by the different sales and purchase structure of the
given universal service suppliers.
E.ON submitted a request to HEO on price decrease in
November 2009 and DÉMÁSZ in December. HEO approved
the requests. The new universal service prices (lower than the
prices in November by average 6.85% and 3.2%, respectively)
came into force on 1 January 2010.
annual report 2009 | 25

hungarian energy office
Trading margin cap and incentives of quality of supply
HEO is obliged to conduct an inspection on the capped
trading margin of universal service suppliers till 31 March of
the year subsequent to year under review. In the inspection,
HEO found that each universal service suppliers had an extra
trading margin in 2008 to be reimbursed to customers. HEO
provided in resolutions on the measure of the amount to be
reimbursed and on the way of reimbursement.
HEO has to complete the inspection of trading margins with
regard to the year 2009 until 31 March 2010.
With introducing an income levelling mechanism for disributors
in August 2006, there was no reason any more to maintain
the instrument of distributors’ profi t cap. Since the new price
regulation cycle, the income levelling mechanism will serve
as a tool also for the operation of a scheme of incentives on
service quality for distributors. The new elements of this
scheme were disclosed in the already mentioned methodolgy
guideline on price regulation of system use charges (published
on 31 October 2008). In line with this guideline, indices of
service quality affect the rate of the infl ation correction
factor to be taken into account in annual price adjustment.
Distributors who achieve better service quality indices while
distribution charges are uniform nationwide, gain extra money
through the income levelling mechanism to the detriment of
distributors achieving worse indices. HEO, after availing and
processing the data, can complete the assessment of service
quality indices of 2009 by late Spring in 2010, therefore their
effect will be refl ected in the administrative prices of 2011.
In addition to the above, on HEO’s proposal, the regulation
on the sanctioning of worsening service quality indices of
distributors was included again in the Decree on the setting of
charges for system use [GKM Decree 119/2007 (29.12)]. In
line with this provision, if the service quality indices specifi ed
in a HEO resolution worsen, the distributor must give a price
discount of 1-3% to the customers from its distribution charges
in the second half of the subsequent year.
HEO is examining the possibility of the extension of this
scheme of incentives on service quality also to the transmission
system operator.
PUBLIC SERVICE OBLIGATION AND CONSUMER
PROTECTION
Approval of Codes
The Electricity Act and its enforcement decree were
modifi ed several times in 2009. These changes required a
continuous adjustment of licensees’ Business Conduct Rules
to the effective statutory provisions. After comprehensive
discussions in more rounds, provisions serving the protection
of users have become more stressed in the modifi ed Business
Conduct Rules. HEO did not issue any resolutions on
the approval of Business Conduct Rules, but issued seven
resolutions on the modifi cation thereof in 2009.
annual report 2009 | 26
Service quality
The minimum quality requirements concerning individual
consumers are prepared on the basis of the annual data supply
of the scheme of Guaranteed Services and the evaluation of the
licensees’ activity in the previous year was completed in June
2009, and can be seen also on the webpage of HEO. In 2009,
also the scheme of Guaranteed Services itself was modifi ed
in accordance with the new regulation and also in line with the
activity of the distribution licensees, and also with the activity
of universal service licensees operating within a new legal
framework. The resolution on Guaranteed Services imposed
the obligation of automatic penalty payment with regard
to 10 of 13 minimum quality requirements on distribution
licensees, 4 of 5 minimum requirements on universal service
suppliers and 3 of 4 minimum requirements on trade licensees.
Aggregate fi gures on Guaranteed Services are shown in Table
7.
In 2009, HEO, following a discussion that took for several
months, made a detailed regulation on the requirement
II of Guaranteed Services for distribution licensees, the
’restoration of interruption of electricity supply affecting
several consumption places’ taking into account the effects of
extreme weather conditions ’accompanied by a disturbance
occuring on the effect of extreme wear and tear beyond design
conditions’. It was required particularly by the failure
between 27 January and 2 February and the growing number
of requests on exemption due to the increasing number of
failures. The modifi cation affected the procedure of the
qualifi cation of extraordinary events and the requirements of
restoration of supply. It is now the licensees’s responsibility
to qualify instead of an independent organisation, however, if
the distribution licensee fails to observe the deadline for the
restoration of breakdown, it will pay a penalty to the affected
user. Users are entitled for a repeated penalty for each further
12-hour outage after the deadline of restoration of breakdown
expires. This is a tool for HEO to motivate distributors to
accelerate the restoration of breakdowns. Penalty payment
will be automatic from 2011 taking into account the time
required for the development of the IT systems of distribution
licensees. Prior to than, penalty is paid based on the users’
claim.
In 2009, HEO investigated whether distribution licensees
observed the provisions specifi ed in the resolutions on
Guaranteed Services to be provided by distribution licensees,
paid the penalties to be paid automatically and managed
properly the rides of forestry. HEO stated that licensees’ data
registry is suitable to fulfi l the Guaranteed Services, and the
order of procedure of rider management is suitable for the
secure operation of networks.
From among distribution licensees, DÉMÁSZ Hálózati Elosztó
Kft. paid penalty in each failed case in 2008. (Ratio
of fulfi lling penalty payments: 100%). The ratio of fulfi lling
penalty payments in the case of the other four licensees
varied between 3.5% and 0.4%. From among universal service
licensee, it was DÉMÁSZ Nyrt. again that achieved the
highest ratio of penalty payments (35%), while this ratio was

Licensee
Number
of cases
(total)
Number of cases
(failed)
1.1% at ELMŰ Nyrt. and 0.31% at ÉMÁSZ Nyrt.. Licensees
paid a total of 22 million HUF to users for failing to perform
Guaranteed Services.
The regulation of the quality of client service - constituting
a part of quality of service - was renewed in 2008. In 2009,
HEO did not issued any new resolutions. However, there
were several discussions among HEO and the licensees on the
interpretation of the content of the resolutions. The evaluation
of data supplied on the basis of resolutions pertaining to 2008
was completed in June 2009 and can be found on the homepage
of HEO.
In accordance with the provisions of the Electricity Act and its
enforcement decree that came into force on 1 January 2008,
licensees have to maintain a client service offi ce in each small
region. Licensees evaluated the activity of the newly opened
(local) offi ces and the quality of services provided by these
offi ces in 2009. Several offi ces that proved to be too small
for the client turnover or the ones that were too diffi cult to
access were moved to another place or have been expanded.
Experience of the operation of (local) offi ces show that users
like using the points of personal communication in their
neighbourhood. However, the offi ces are rarely visited after
18.00 hour on small micro-regions, in particular, while their
Proportion
of failed cases
(%)
annual report 2009
operation consumes
considerable fi nancial
resources, which
have to be paid by
the users community
in the price of
electricity. In aware
of the fi gures on client
turnover, it would
be worth rethinking
the regulation of
the local offi ces so
that customers be
charged only with the
maintenance costs of
those offi ces where the
operation results in an
essential, assessable
and measurable
improvement of
comfort for customers.
In 2009, HEO
conducted a
consumer satisfaction
survey giving a
comprehensive picture
on the satisfaction of
customers with the
activity of distributors
and universal service
licensees for the
fourteenth time. 7 400
household customers
and 2 400 nonhousehold
customers participated in the survey. The method
of the survey was the same as in 2008, therefore outcomes
can be directly compared. On the basis of aggregated results,
it can be stated that 2009 did not bring any signifi cant changes
relative to the previous years. Customers still focus on
uninterrupted supply, voltage fl uctuation, early restoration in
the case of interruption and long breakdowns and answering
calls on failures from among the activities of distribution
licensees. Within the sphere of tasks of universal service
licensees, both residential and non-residential customers were
the least satisfi ed with the service quality of complaint management.
Satisfaction with bills and the understandability of
bills defi nitely worsened.
Breakdowns
Payment
of penalty
(HUF)
DÉMÁSZ Hálózati
Elosztó Kft.
475 654 747 0.16 3 576 438
591 686 3 777 0.64 589 000
ÉMÁSZ Hálózati Kft. 242 219 702 0.29 19 000
E.ON Dél-dunántúli
Áramhálózati Kft.
1 491 431 22 133 1.48 1 493 200
E.ON Észak-dunántúli
Áramhálózati Kft.
2 977 416 72 676 2.44 2 136 200
E.ON Tiszántúli
Áramhálózati Kft.
2 163 151 23 402 1.08 1 711 400
Distribution, total 7 941 557 123 437 9 525 238
DÉMÁSZ Nyrt. 126 866 3 878 3.06 5 171 418
602 494 36 102 5.99 1 800 492
ÉMÁSZ Nyrt. 238 465 9 438 3.96 327 000
E.ON
Energiaszolgáltató Kft.
Universal service,
total
Table 7 Aggregated data of Guaranteed Services (2008)
531 341 12 323 2.32 4 919 000
1 499 166 61 741 12 217 910
Total 9 440 723 185 178 1.96 21 743 148
The fi nancial basis for the incentives to electricity distribution
network licensees to improve service level is the minimum
quality requirements on the frequency and duration of nonplanned
interruptions, and the outage index corresponding
to the ratio of the non-supplied electricity. In 2008, indices
started improving after a fallback in 2007. The aggregated
effect of the favourable changes at national level exceeded the
size of deteriorations in given cases.
annual report 2009 | 27

hungarian energy office
In 2009, following a fi ne of 50 million HUF imposed by
HEO in 2008, HEO imposed another fi ne of 60 million HUF
on E.ON Észak-Dunántúli Áramhálózati Zrt., because the
average duration of interruptions was more than 40% worse
than the national average despite the fact that HEO ignored
in its evaluation the effects of outages due to the extreme
weather conditions.
One of the most important elements of the monitoring system
established by HEO in order to detect voltage quality is the
ratio of customers supplied durably (for over 12 months) by
irregular voltage. The fi gures of this index with regard to 2008
show that the values varied according to licensees from year
to year in both size and direction. However, there are some
companies that have not had any users supplied by irregular
voltage even for several years. It is justifi ed to continue
inspections in order to be able to shape a well-founded
professional opinion.
Reliability of electricity supply
In 2008, the Electricity Act provided a possibility to HEO again
to determine minimum quality requirements and expected service
levels. These requirements and standards were calculated
on a three-year basis with a view to mitigate the effects of
extreme weather conditions. In its resolution, HEO requires
annual improvement also with regard to three expected service
level indices expressed in an annual percentage value
relative to the performance of the previous year in addition to
the minimum quality requirements on the indices serving as
a base to fi nancial incentives on service levels to be provided
by electricity distribution
licensees.
In June 2009, HEO
assessed the level of the
reliability of electricity
supply in 2008. In its
assessment available
also on HEO’s homepage,
HEO claimed
with regard to national
fi gures that one of the
internationally accepted
indices serving for the
measuring of continuity
of supply – System
Average Interruption
Frequency Index –
defi nitely improved in
2008 to 1.61 interruption/user (after 1.90 in 2007). The other
international index serving for measuring of the continuity of
supply is the System Average Interruption Duration Index.
Following an improving tendency from 2000 to 2005, this
index stagnated in 2006 and 2007, which was followed by
improvement again in 2008. The duration of interruptions per
customer was 111 minutes in 2008 (following 139 in 2007),
which matches the values of the international middle range.
The duration of interruption projected to the number of users
annual report 2009 | 28
improved in the case of each licensee in 2008. The outage index
(non-supplied energy per supplied energy), which is one
of the indices in the electricity sector that has been kept track
of for the longest time, was characterised by an improving
tendency for several years until 2005. The index worsened by
22% in total in 2006 and 2007, which was followed by a 20%
improvement in 2008.
Following a thorough analysis taking into account all
conditions of each case, HEO gave an exemption from taking
into account a part of breakdown events due to the weather
conditions beyond design conditions. To sum it up, it can be
stated that distribution licensees make large efforts to observe
the annually increasing levels determined in the resolution of
HEO. The detailed documentation of the annual evaluations
can be found on the homepage of HEO.
In 2009, HEO investigated data collections made by
distribution licensees in relation with reliability of electricity
supply, the documentation of planned and non-planned failures
and data supply to HEO. In the course of the investigation,
HEO found that licensees’ data supply is in compliance with
the provisions specifi ed in the relevant decrees.
Consumer complaints
2009 did not see any signifi cant changes in HEO’s complaint
management. The Electricity Act divided the competence
of complaint management amongst HEO and Nemzeti Fogyasztóvédelmi
Hatóság (Hungarian Authority for Consumer
Protection) on 1 January 2008. The Act failed to unambiguously
regulate the mangement
of several complaint
types, which required the
two authorities to have
frequent discussions
on competences in
2008. The amendment
of the Electricity Act
during 2009 (on 1 July
2009) ceased these
uncertainties, and both
HEO and Nemzeti Fogyasztóvédelmi
Hatóság
could unambiguously
determine their cirlce
of competence and
the borders thereof,
respectively. With a view
to ensure the relevant
knowledge required for the management of complaints of
the electricity sector, HEO provided a regular and frequent
support in the whole year to Nemzeti Fogyasztóvédelmi Hatóság.
As a result of the division of authority specifi ed by the
Electricity Act, the number of consumer notices received by
HEO in 2009 essentially remained unchanged following a
decrease of 41.35% in 2008. The number of complaints grew

from 1 841 to 1 877, which correspond to an increase below
2%. In 328 of 1 877 complaints, HEO did not have authority
to proceed, so all of these complaints were transmitted to the
Nemzeti Fogyasztóvédelmi Hatóság.
Accordingly, HEO handled 1 549 notices in the end. From
among these, 655 were not regarded as complaint. From
among the total of 894 complaints, there were 405 that affected
electricity licensees. This amount is higher by 74% than the
fi gure in 2008. HEO launched supervisory procedures in the
case of each complaint and made the relevant resolutions on
each case. Based on the resolutions, 34% of the complaints on
distribution licensees - mainly in the fi eld of breach of contract
– and 38% of the resolutions on universal service suppliers -
mainly in the fi eld of billing – could be qualifi ed justifi ed.
In addition to the increase of the number of complaints on
electricity licensees by 80%, HEO enhanced its supervising
annual report 2009
activity. Within the framework of this activity in 2009,
the inspected areas were the following: compliance of the
content of bills with statutory provisions, service level of
call centres, operation of automatic call answering systems,
order of procedure for the management of contract breaching
behaviours, compliance with statutory provisions on
vulnerable customers, data supplies specifi ed in resolutions
on service quality, registration and professional correctness
of responds to documented requests and the establishment
and operation of client service offi ces and local offi ces. In
the course of the inspections closed by resolution, HEO did
not fi nd any defi ciencies serious enough to impose a fi ne.
However, HEO imposed various obligations on licensees
including the transformation of workfl ows, provision for
technical conditions and modifi cation of the content of fi ll-in
forms in its 13 resolutions closing the inspections, which were
issued in 2009.
annual report 2009 | 29

hungarian energy office
REGULATION OF THE NATURAL GAS MARKET AND ITS
IMPLEMENTATION
REGULATION
Licensing
The new regulatory environment has not signifi cantly changed
the general rules of licensing. In accordance with the provisions
of the Gas Act, HEO, in the license issued, sets the conditions
of performing licensed activities and related activities. On the
basis of the Gas Act, Articles 124 -130 of the enforcement
decree determine the new, detailed rules of licensing in the
changing market environment. It is an important requirement
to continuously control the compliance of the licensees with
these conditions. HEO supervises the licensees whether or
not they comply with the provisions of the license and, if
necessary, applies sanctions.
With regard to licensing, the enforcement decree of the Gas
Act defi nes general rules and for certain activities subject
to license it also defi nes special rules specifying the type of
documents to be submitted by the applicants together with
the applications for license as defi ned by the Gas Act and the
instruments they have to possess. In addition to the general
and special rules, the enforcement decree of the Gas Act has
detailed provisions concerning the contents of the different
licenses, and the compulsory requisites of the applications for
licenses; these are included in the annexes of the Decree.
According to Section (1) of Article 140 of the Gas Act,
public utility service licensees submitted their applications
for licenses prior to 30 November 2008. On the basis of the
applications, HEO has issued 9 new licenses for universal service
by 30 January 2009 in accordance with Section (3) of
Article 140 of the Gas Act.
The enforcement decree of the Gas Act regulates in details – in
accordance with the regulations of the Gas Act – the provisions
in connection with ensuring the natural gas sources for the
consumers entitled to universal service. These provisions
determine that the universal suppliers have to dispose of what
kind of natural gas sources to secure the safe supply of the
consumers.
The Universal Service Code is a separate annex of the
enforcement decree of the Gas Act by itself, which contains
the detailed rules of the relation between the consumer
entitled to universal service and universal supplier supplying
services (determined in the Article 35 of the Gas Act) for
him. It also contains the obligatory formal and the contextual
requirements of the universal service contract emerging
between the universal supplier and the consumer.
The consumers not entitled to universal service have to
organize their supply or contract with a trader on their own.
annual report 2009 | 30
HEO, on the basis of Section (1) of Article 140 of the Gas Act,
has issued 46 new operational licenses effective since 1 July
2009, in accordance with the change of the legal background.
More precisely, 2 new pipelined LPG gas, 1 new natural gas
transmission, 2 new natural gas storage, 29 new natural gas
trade, 11 new natural gas distribution, and 1 new universal
service licenses were issued.
Existing licenses were modifi ed in 39 cases, and 5 licenses
were withdrawn in 2009. HEO issued resolution approving the
establishment of direct pipelines in two cases. The resolutions
issued by HEO enabled the operation of six additional
competitive natural gas traders, which meant that the number
of natural gas trade licensees increased to 31 in 2009.
Due to the model switch the types of activities subject to
license changed compared to the previous period. The new
types of activities subject to license are the universal service
and the one-stop-shop capacity sales.
License types that discontinued in 2009 are the following:
• public utility wholesale license
• public utility service license
• operational license for access to cross-border transmission
pipelines of natural gas
New activities subject to license are the following:
• universal service
• one-stop-shop capacity selling
Universal service is a new institution on the domestic natural
gas market with the main task to provide a special supply for
small customers. Residential customers and other users having
contracted capacities not exceeding 20 m 3 /hour capacities are
entitled for universal service. In a transition period the users
who have license for district heat production determined
in a separate law (till 30 June 2011) and the users whose
consumption exceed 20 m 3 /hour but do not reach 100 m 3 /hour
(till 30 June 2010) are entitled for universal service too.

The Gas Act allows the issuance of new licenses for one-stopshop
capacity selling. The demand of enhancing the security of
supply makes it necessary to build a new transmission pipeline
crossing several countries. The new license specifi ed in the
Gas Act aims to facilitate the management of the applications
for the construction of international pipelines operating on the
basis of one-stop-shop principle by the adequate modifi cation
of the regulatory environment. The one-stop-shop principle
ensures signifi cant comfort for shippers and traders because
they have to contact and contract with only one company
independently from how many countries they wish to cross
with their transport.
HEO has not yet issued a one-stop-shop capacity selling
license in 2009, but it has in its resolution obliged the investor
and future operator of the NABUCCO pipeline – NABUCCO
Gas Pipeline International GmbH – to apply for the license in
the future.
Allocation of cross-border capacities and congestion
management
Capacities of cross-border interconnection points are the
following:
• Western entry point – Mosonmagyaróvár: 13.1 million m 3 /day
• Eastern entry point - Beregdaróc: 42 million m 3 /day (until
30 June 2009), then 72 million m 3 /day (from 1 July)
Gas turnover of the cross-border interconnection points:
• Mosonmagyaróvár: 5.7 million m 3 /day import gas on
average, for domestic use;
• Beregdaróc: 21 million m 3 /day import gas for domestic
use + 12 million m 3 /day transit towards Serbia and Bosnia
and Herzegovina.
The major part of cross-border capacities have been allocated
by long term contracts.
Long term natural gas import contracts and their duration:
Panrusgas 9000 million m3 /year until 2015
E.On Ruhrgas 500 million m3 /year until 2015
Bothli Trade AG 900 million m3 /year until 2014
Gaz de France 600 million m3 /year until 2012
annual report 2009
The long term transit contract concluded with Serbia, which
includes a 12 million m 3 /day continuously contracted pipeline
capacity, will expire in 2012. There are contracted congestions
on the Eastern, Beregdaróc cross-border point. By 1 July 2009,
the new pipeline development project of the transmission
licensee had been fi nished, which had practically doubled the
import capacity from the Eastern direction. In the course of
the construction works in 2008, a new pipeline of 1000 mm
diameter from Beregdaróc to the compressor station was
built, which extends the Eastern entry capacity by 30 million
m 3 /day. In addition to the dissolution of the aforementioned
congestions, the primary aim of the pipeline is to ensure the
possibility of fi lling up the strategic natural gas storage being
built in Szőreg-I level of the Algyő gas fi eld. As a result of
another development of the transmission licensee FGSZ Földgázszállító
Zrt., another pipeline was built in 2009 towards
Romania. The Hungarian side of the Szeged-Arad pipeline is
already completed; it will feature a 700-mm-diameter pipeline
with a two-directional gas transmission capacity of 12.1
million m 3 /day.
Regulation of the responsibilities of transmission and
distribution companies
The high-pressure transmission pipeline system is operated
by a single company (FGSZ Földgázszállító Zrt.). FGSZ
has two operational licenses issued by HEO: a natural gas
transmission license and a system operation license. The
Gas Act defi nes the general rules on natural gas transmission
activities, and lists in details the conditions of issuing a license
annual report 2009 | 31

hungarian energy office
for natural gas transmission. The most important task of a
natural gas transmission company – in addition to natural gas
transmission – is the daily balancing. The activities related to
the provision of balancing gas are not considered natural gas
trading by the law. The transmission company, for fulfi lling its
responsibilities, operates an information system that provides
an internet-based data traffi c necessary for the hydraulic
balance of the natural gas system.
The Gas Act introduces and regulates the daily natural gas and
capacity trade. The objective of that regulation is to ensure that
the commercial transactions necessary for the maintenance of
the daily balance-keeping of the natural gas system are marketbased.
Compared to the previous regulation, it provides a
more detailed regulatory guidance with regard to the capacity
allocation in the natural gas system and to the access to the
system, the rules of which are detailed in the enforcement
decree of the Gas Act.
Eligible customers are entitled for the transmission, storage or
cross-border transmission capacity contracted in their public
utility contract even after the public utility contract itself is
terminated. This capacity is not regarded as a new demand
for capacity contracting. The right of capacity and the right
of connection are fi xed to the point of consumption after the
public utility segment ceased.
Natural gas distribution systems are operated by 10 regional
distribution companies. The Gas Act specifi es the general
rules on the natural gas distribution activity including the
conditions of license issuing, the obligation of a distributor to
cooperate in the interest of the development and operation of
the cooperating natural gas system, and it also lists in details
the cases when the distributor may refuse the connection of
any consumer, or the start of natural gas distribution activity
or the continuing of supply for a consumer already connected.
Natural gas distributors have to register the consumption
places withdrawing natural gas from distribution pipleines
as well as their typical and prescribed data and deliver this
information on request to the user withdrawing natural gas at
the consumption place or to his trader. The detailed rules of
natural gas distribution services are included in the Natural
Gas Distribution Code constituting one of the annexes of the
enforcement decree of the Gas Act.
annual report 2009 | 32
HEO, in the approval resolution 871/2008 of October 2008,
did not only prescribe modifi cations regarding the Network
and Commercial Code (hereinafter ÜKSZ – Üzemi és Kereskedelmi
Szabályzat) concerning the technical operation of
the natural gas system and the trade process, as submitted in
May 2008, but also imposed a fi ne on the system operator.
The resolution imposing the fi ne was contested by the system
operator at the court, but it soon withdrew the lawsuit and
submitted the new, modifi ed version of the ÜKSZ in December
2008. The new approval procedure was conducted taking into
consideration that a completely new ÜKSZ will be necessary
after 1 July 2009 due to the change of the relevant legislation,
which needs to be prepared soon after the coming into force of
the enforcement decree of the Gas Act. Resolution 127/2009
of HEO ordered a modifi cation of the rules concerning the
profi le-based settlement system, and the calculation method of
the capacity transfer in connection with switching traders, and
the price of the balancing gas, allowing for the possibility to
submit the modifi ed rules as part of the new ÜKSZ.
The new ÜKSZ was submitted on 30 April 2009. HEO has
approved the ÜKSZ, but in spite of negotiations with the
system operator during the approval process, resolution
432/2009 of HEO prescribed 351 different modifi cations,
corrections, amendments, 197 of which were signifi cant ones.
The rules of capacity booking, supplier switching and isolated
operation were especially disputed. The resolution in some
cases ordered the review of entire chapters. A frequent problem
was that the procedures of the various system operators
(transmission, storage and distribution) were not harmonized,
which would have resulted in insolvable problems at the
connection points of the systems. The modifi ed ÜKSZ was
submitted by the system operator on 18 September 2009. The
approval procedure was in progress until 2010. The shortages
found by HEO show that the most problems for licensees arise
from the handling of isolated operation, the interpretation and
application of the system of registered capacities, and the
elaboration of the different detailed rules of the profi le-based
settlement, however, the harmonization of procedures of the
different systems could not be entirely fulfi lled either.
The problems of the preparation of ÜKSZ lies in the fact that
rules and regulations were signifi cantly modifi ed without
having enough time to discuss and accept the new notions and
Description/year 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Number of events causing outage 2 862 3 138 3 924 2 802 2 103 2 049 2 368 1 666 1 424 1 368
Within which:
outages due to breakdown
Number of outages with direct
responsibility of the suppliers
Within which: breakdowns with
direct responsibility of the suppliers
Table 8 Number of events causing outages in natural gas supply (pcs/year)
2 532 2 604 2 988 2 424 1 786 1 848 1 953 1 440 1 178 1 164
1 473 1 312 1 607 1 090 989 853 847 705 766 680
1 222 894 933 731 743 738 707 574 614 560

4000
3000
2000
1000
0
1.4
1.2
1.0
0.8
0.6
0.4
0.2
0.0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Number of events causing outage
within which: outages due to breakdown
Number of outages with direct responsibility of the suppliers
within which: breakdowns with direct responsibility of the suppliers
Figure 5 Quantitative data of the events causing outages in natural gas supply
(pcs/year)
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
total outages
concepts, and the application method of these could not be
streamlined, while as a consequence of the new regulation, the
tasks of licensees have signifi cantly changed, they increased
in number, and lawmaking did not even reach a stable state.
Unbundling of activities
outages with direct responsibility of the supplier
outages with direct responsibility of the supplier, due to breakdowns
Figure 6 Number of the events causing natural gas outages per 1000 consumers
(pcs/1000 consumers/year)
The accounting unbundling in accordance with the Gas Act
is compulsory for all natural gas undertakings, no exemption
can be granted. If the activities of natural gas transmission,
distribution and storage are performed by a vertically integrated
natural gas undertaking, the activities subject to license have
to be performed in organizations and through decision making
procedures that are separated from the directly not related
other activities, legally unbundled and independent from
organizational and decision making viewpoints, except for
a) the natural gas transmission company with system operation
license,
b) natural gas trader companies supplying less than 100 000
consumers,
c) Pipelined LPG suppliers.
FGSZ Földgázszállító Zrt. is a legally unbundled company of
MOL Nyrt. According to Article 6 of the enforcement decree of
the Gas Act, the transmission activity has to be performed in a
separate organizational unit and with an independent decision
annual report 2009
making process. The senior managers
of the system operator may not take part
in other natural gas activities (subject
to license) either directly or indirectly.
With regard to the fl ow of information,
the system operator has to perform its
natural gas activities in the same way
in the case of parties belonging to the
same ownership structure as in the
case of other actors of the market. The
natural gas transmission company is
also physically (headquarters, offi ce
building) separated from all other business
organizations performing natural
gas activities.
Five out of the ten natural gas
distribution licensees are major
regional companies with more than
100 000 consumers. In accordance with
the provisions of the Gas Directive
55/2003/EC, the fi ve large public utility
suppliers and natural gas distribution
companies already completed legal
unbundling in 2007. Accordingly, they
perform the natural gas distribution
and public utility supply activities in
separate companies. The public utility
wholesale activity was performed by
E.ON Földgáz Trade Zrt. until 30 June
2009, which is a vertically integrated
fi rm of E.ON Ruhrgas International
GmbH, even though it operates in a
fully separated way from the gas storage licensee E.ON Földgáz
Storage Zrt. Public utility segment ceased from 1 July
2009. E.ON KÖGÁZ Zrt. and E.ON DDGÁZ Zrt. performing
the distribution of natural gas are also legally unbundled
companies.
Quality of supply
Customers expect continuous supply, i.e. a uninterrupted
availability of natural gas. Certainly, the piplined gas supply
is accompanied by various, accidentally occurring or planned,
or otherwise caused outages. Outages can be caused by
breakdowns or other reasons, e.g. maintenance, reconstruction
works, etc. Some of the reasons are directly related to the
supplier, others in turn are independent from him. The quality
of the physical process of pipelined natural gas supply can be
assessed and demonstrated by the reason, time and duration
of outages.
The development of the number of outages is shown in Figure
5 based on the data of Table 8. The Figure shows that customers
were hit by the outages to an increasing-decreasing extent.
The proportion and absolute number of the outages where the
suppliers were directly responsible increased in the fi rst half
of the period, and then it continuously decreased. The Figure
is also indicating the frequency of the breakdowns causing
annual report 2009 | 33

hungarian energy office
outages, which is constantly lower than
the total frequency of outages.
The physical process of the pipelined
natural gas supply can be assessed using
the specifi c indicators calculated as the
number of events and the duration of
consequent outages per 1000 consumers.
Figures 6 and 7 demonstrate the countrylevel
frequency and duration when the
customers were without supply. The
specifi c number and duration of outages
for the total of outages is fl uctuating
in the observed period, while the
events with direct responsibility of the
suppliers have a smaller proportion and
show a continuous improvement.
COMPETITION
Wholesale market
The data of the Table 9 summarizes the natural gas consumption
of the country in 2009, and the composition and percentage of
the sources for 2009 [billion m 3 /year].
Table 9 Sources and composition of the natural gas consumption of the country in 2009
Natural gas consumption of the country
Domestic production
Import
-from Eastern direction
- from Western direction
The import sources of natural gas are primarily of Russian
origin, even the natural gas received from the Austrian Baumgarten
through the HAG pipeline and bought from E.ON
Ruhrgas has Russian molecular origin.
The natural gas consumption of the country signifi cantly
decreased from 14 billion m 3 in 2008, by 3 billion m 3 . The
proportions of the natural gas sources signifi cantly changed in
2009 compared to 2008 and the previous years. The volume
of domestic production – after two decades of declining
– increased by 17% in 2009 to over 3 billion m 3 , thank to
the production from Hajdúnánás fi eld newly discovered
by Magyar Horizont Kft. who newly entered the market in
August. Accordingly, the domestic/import ratio, which was
characteristically at 20/80% in the past years, also changed
signifi cantly, to 28-72%.
The import from the East decreased from 9 billion m 3 in the
year 2008 to 3 billion m 3 , which is mainly resulted from the
consumption cut resulting from the economic crisis, and from
the alternative fuel consumption of residential customers.
annual report 2009 | 34
5.0
4.5
4.0
3.5
3.0
2.5
2.0
1.5
1.0
0.5
0.0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
3 billion m
11.115
3.090
8.025
6.064
1.961
total outages
outages with direct responsibility of the supplier
outages with direct responsibility of the supplier, due to breakdowns
Figure 7 Duration of the events causing natural gas outages per 1000 consumers
(hours/1000 consumers/year)
The number of registered eligible customers entering the
competitive market rose to 9782 in 2009 (2527 non-household,
and 7255 household customers).
The Resolution of the Commission of the European Union,
DG Competition of 21 December 2005 (Case No COMP/
M.3696-E.ON/MOL) approved the 100% acquisition of MOL
Földgázellátó Rt. and in MOL Földgáztároló Rt. by E.ON
Ruhrgas International AG as subject of specifi c conditions.
One of the key conditions is the implementation of Gas Release
%
100
27.8
72.2
54.6
17.6
Program, which mean that E.on Ruhrgas
AG is obliged to offer an annual amount
of 1 billion m 3 natural gas for sale in
the natural gas market, for a period of
8 years (2006-2013). The program is to
be implemented in the form of auctions
during the given years, where the annual
1 billion m 3 quantity must be divided
into the following sales units:
• 5 lots of 100 million m³ units,
• 5 lots of 50 million m³ units,
• 10 lots of 25 million m³ units.
The affi liates of E.ON cannot either directly or indirectly take
part in the auctions.

The winners of the auctions may conclude
contracts with ERI under the following terms
and conditions:
• The contracted amount of gas will be
transported in two years, in two equal parts,
through the import entry points – Beregdaróc
80%, Mosonmagyaróvár 20%.
• The supply contracts will provide the same
level of fl exibility as the upstream contracts
of MOL Földgázellátó Rt.
The auctions are carried out by an international
information technology service provider.
E.ON Földgáz Trade Zrt. held its fourth natural gas auction in
March 2009, in accordance with the relevant rules.
The most important one of the provisions of the Gas Act
facilitating competition is the reinforcement of the market
environment; on the basis of that, HEO started its investigation
procedure in 2008 (on 30 October 2008) concerning
signifi cant market power. If the investigation of HEO states
the imperfection of the market competition and the presence
of signifi cant market power, HEO can oblige the affected
licensees to the execution of the obligations defi ned in the
Act. In the course of the procedures of designating licensees
having signifi cant market power and of imposing obligations
on them, HEO cooperates with the Competition Authority, and
takes into consideration its professional opinion.
Retail market
The enforcement decree of the Gas Act separately provides
detailed rules for switching traders, the essence of which is
that the customer or the new natural gas trader charged by
him can abrogate the commercial contract or the public utility
contract – unless agreed in the opposite – by the fi rst day of the
second month following the notifi cation. The customer may
charge the new natural gas trader with arranging the procedure
of trader switching. The notice period cannot be less than 30
days.
A new element of the Gas Act is the revisiting of the gas sales
on gas-days, in the framework of which the Act introduces
and regulates the daily natural gas and capacity trading. The
purpose of this provision is to promote that the transactions
necessary for the daily balance-keeping of the natural gas
system are market-based.
In the retail market there was a signifi cant change in 2009, as
the public utility segment ceased from 1 July, and the public
utility supply was replaced by universal service. In accordance
with Section (1) of Article of the Gas Act, public utility supply
licensees submitted to HEO their applications for universal
service license by 30 November 2008. On the basis of the
applications, HEO issued 9 new licenses for universal service
until 31 January 2009. The majority of household customers
did not switch suppliers, they remained with regional
universal service suppliers. Therefore competition is not yet
annual report 2009
Table 10 Maximum technical capacity of the domestic natural gas system as of
31 December 2009 [million m 3 /day]
Domestic production
Import (Western direction)
Import (Eastern direction)
Commercial gas storage
Security gas storage
TOTAL
o
(* in the case of a -15 C daily average temperature the technical capacity ensures the continuous
gas supply of the country)
prevailing in the retail market, the position of market actors
do not refl ect a competitive situation with regard to the supply
of all consumers groups, but rather refl ects traditional regional
distribution, the situation before market opening.
SECURITY OF SUPPLY
The highest-ever natural gas consumption of the country, 89.5
million m 3 /day, was measured on 9 February 2005. Comparing
that to the above data, it can be seen that the capacity of the
domestic natural gas system is much higher than this value, the
technical background of the security of supply is appropriate.
The new Gas Act defi nes a gradual handling of the disturbances
occurring in the natural gas system. In the case of small
breakdowns, licensees shall take measures by themselves.
In the case of critical situations when the majority of the
customers may be affected by interruption – e.g. in the case of
a signifi cant outage of imports – it is the Government who can
order emergency measures.
Natural Gas Transmission
10.5
13.1
60.0
55.1
20.0
158.7*
From the point of view of security of supply, it is important
that the repair and replacement of the malfunctioning pipeline
sections discovered in 2009 during the pipeline and structure
reconstruction works improving the availability and the
security of the transmission capacity, and during the in-line
intelligent pig inspection was completed.
annual report 2009 | 35

hungarian energy office
The dispatch centre of natural gas system operator and
the dispatch service of the MAVIR Zrt. are maintaining a
continuous operative connection. MAVIR Zrt informs the
natural gas system operator before the beginning of each gas
days on the expected size of power plant consumption. If a
signifi cant power plant upload is expected within a given gas
day, MAVIR Zrt. indicates its expected size, which allows
the natural gas dispatch center to regulate the mode of the
connecting pipelines accordingly. If there is any change in the
operation of the natural gas transmission system that affects
the operation of power plants generating electricity, than the
dispatch center will warn immediately MAVIR Zrt. about this
event.
Strategic natural gas storage
In line with the provisions of Article 3 and 4 of Directive
2004/67/EC, Hungary has also put the issue of security gas
storage in the foreground. Act 26 of 2006 on the security
storage of natural gas prescribes the storage of 1.2 billion m 3
gas, and the construction of an underground storage required
for that by 2010. The natural gas security storage must be
placed in a UGS facility that has a daily withdrawal capacity
of 20 million m 3 for at least 45 days. The security storage of
natural gas prescribed by the Act exclusively serves the secure
supply of natural gas to household and communal customers.
Until 31 December 2009, the spare capacity of the present
natural gas storage facilities determined the degree of the
security storage, which – if an adequate quantity of spare
capacity is available – could not be less than
a) 150 million m 3 from 1 October 2006 to 30 September 2007,
b) 300 million m 3 from 1 October 2007 to 31 December 2009.
If this capacity cannot be secured from the remaining, free
storages it can be replaced by the adequate quantity of petrol
products, to be accurate this means heating oil. According to
the above mentioned the Hungarian Hydrocarbon Stockpiling
Association injected 200 million m 3 natural gas as security
storage in the Zsana underground gas storage facility of the
E.ON Földgáz Storage Zrt and 100 million m 3 in the Szőreg-I
underground safety gas storage facility of the MMBF.
The Hungarian Hydrocarbon Stockpiling Association has
announced a call for tender for the construction of the
security storage facility, which was awarded to MOL Nyrt.
The Hungarian Hydrocarbon Stockpiling Association and
Table 11 Capacities of the underground gas storage facilities of E.ON Földgáz
Storage Zrt. at the end of 2009
Name of the
underground
gas storage facility
HAJDÚSZOBOSZLÓ
KARDOSKÚT
PUSZTAEDERICS
ZSANA
Total:
annual report 2009 | 36
Maximum storable
working gas
stockpile
3 (million m )
1440
280
340
2170
4230
Injection
capacity
(million m /nap)
11.50
2.35
2.90
17.00
33.75
MOL Nyrt. established MMBF Zrt for the tasks of investment
and operation of the security storage facility. Construction
started in 2007 at the Szőreg-I layer of the Algyő gas-fi eld.
The project was continued in 2008-2009 by drilling 44 new
double-function wells (withdrawal-injection). The investment
progressed according to the plan, and from 1 October 2009,
when the compressor-technology was ready, the operative
injection started, and by the end of the year the prescribed 1.2
billion m 3 natural gas has been put in the storage.
Commercial natural gas storage
E.ON Földgáz Storage Zrt. fi nished the investment of phase IV
of Zsana underground gas storage on 1 December 2009, in the
framework of which working gas capacity was increased by
600 million m 3 , and the exploitation capacity rose by 4 million
m 3 per day, thereby creating the largest gas storage facility not
only in Hungary, but in the entire Central Eastern European
region. During the year 2009, the Maros-I gas storage facility
was intruded by water, therefore the gas storage activity was
discontinued there. The capacity lost was compensated by the
Zsana development.
From the point of view of security of supply it is important
that more than half of the country-level daily peak demand can
be covered from storage.
Determination of natural gas restriction order
HEO determined a restriction order for the case of supply
disturbances back at the end of September 2008, which
ensures the continuity of gas supply to certain circles of
customers. Currently, HEO ranks into the category of
primarily restrictable customers all the gas fuelled power plant
units that are able to switch to alternative fuelling, for which
the law requires to keep a liquid fuel stock suffi cient to ensure
a 16-day continuous operation. Unfortunately, restriction was
needed to be put in place right in January 2009 as detailed in
the next section.
The restrictive provisions of the enforcement decree of the
Gas Act have partly taken into account the experience of the
January gas crisis. By the end of August a new restriction
classifi cation was prepared for the years 2009/2010, which
listed more categories than previously and this was approved
– after the modifi cations requested by HEO were made – by
Withdrawal
capacity
(million m /nap)
3 3
20.8
3.2
3.1
28.0
55.1
resolution 591/2009 of HEO on 15
October. Due to customer complaints,
the classifi cation of two users had to be
modifi ed ex offi cio at the end of November.
Handling of the gas crisis of January
2009
As a result of the Russian-Ukrainian
gas debate, the import gas transmission
from Eastern direction decreased to one
third by 6 January, and it fully stopped

y 7 January. In the evening of 6 January, the system operation
licensee ordered – in accordance with the enforcement decree
of the Gas Act – the restriction of the fi rst category (large
customers above 2500 m 3 /hour consumption), which was
followed by the restriction of category II (customers between
500-2500 m 3 /hour) on 7 January. On 7 January – on the basis
of GKM Decree 75/2007 (17.08) – the Natural Gas Crisis
Committee convened a meeting, and coordinated the necessary
measures on the following days. E.ON Földgáz Storage Zrt.
increased the withdrawal from the gas storage facilities from
6 January to the maximum. The restriction of category II was
removed after one day, the large customers of category I.
(primarily the gas-combustion power plants) remained under
restriction until 15 January. MOL Nyrt. also increased the
production of the domestic natural gas
fi elds to the maximum available level.
KHEM Decree 1/2009 (07.01) on the
authorization of the use of the security
natural gas reserve was issued, but in
the end there was no need to use it.
After 2 days of reduced operation (2
million m 3 /day) on 8 January, thank to
the measures taken by E.ON International
GmbH, the level of the import
from the Western direction increased
(8-9 million m 3 /day) out of which
the Hungarian Government was able
Transmission charges
Entrance charge
3 {HUF/(m /h)/year}
Exit charge
3 {HUF/(m /h)/year}
3
Volume charge (HUF/m )
3
Average price (HUF/m )
to help out Serbia, who was undergoing an absolute crisis.
Finally, on 20 January the Eastern import gas transmission
started, and on 21 January it already operated at full capacity.
As a summary, the outage of gas import affected Hungary the
least compared to the surrounding countries, thanks partially
to the extent of the established gas storage capacity, to the
adequate winter preparations, and to the fair cooperation of
the affected organizations.
On the basis of the experience of the January gas supply crisis
and Directive 2004/67/EC, Government Decree 265/2009
(1.12) was issued on the restrictions of natural gas offtake,
the use of the natural gas safety reserve, and the measures
necessary in the case of a natural gas crisis.
Table 12 Change of the transmission charges in 2009
annual report 2009
customers. On 1 July 2009, KHEM Decree 28/2009 (25.06) on
the setting of prices in connection with the natural gas universal
service came into force.
Characteristics of the price system and price regulation
from 1 January 2009 to 30 June 2009
GKM Decree 105/2005 (19.12) on the frameworks of natural
gas price regulation orders the application of a regular price
adjustment for 1 January and 1 April on the basis of the factors
affecting the purchase costs of natural gas.
The resale charges (resale capacity charge and resale gas
charge) serving as the basis for the settlement between the
01.07.2008 01.07.2009 Change
8 373 9 932 19 %
2 455 2 231 -9 %
1.165 0.833 -29 %
3.702 4.01 8 %
wholesaler and the public utility service suppliers have not
changed in the fi rst half of 2009. With the model switch, the
public utility wholesaler status has ceased to exist since 1 July
2009.
Characteristics of the price system and price regulation
from 1 July 2009 to 31 December 2009
After the model switch of 1 July 2009, the price preparation
activity of HEO is focused on the system use charges. In the
new model, universal service suppliers replacing public utility
service providers supply customers under 100 m 3 /h as well
as district heat generation licensees who have not entered
the competitive market. HEO in resolution decides about the
charges to be applied by universal service suppliers – on the
basis of pricing requests of licensees (once each quarter).
PRICE PREPARATION, PRICE REGULATION
GKM Decree 70/2003 (28.10) on the setting of natural gas
With regard to price regulation, 2009 brought a signifi cant
change. GKM Decree 105/2005 (19.12) on the frameworks
of price regulation of natural gas served as a basis for system
system use charges was amended in January and April 2009,
and subsequently it was repealed by KHEM Decree 31/2009
(25.6) on the setting of natural gas system use charges, which
use charges and the public utility end
user charges until 30 June 2009. After
the model switch in natural gas mar-
Table 13 Change of the storage charges in 2009
Storage charge 01. 07. 2008 01. 07. 2009 Change
ket in July 2009, the above decree only
provides for the price regulation of the
system use charges.
Injection charge (HUF/m ) 1.369
0.439
0.78
0.119
-43 %
-73 %
On 1 July 2009, public utility supply en-
4.93 5.32 8 %
ded, and the group of customers supplied
in the framework of universal service
219.81 230.26 5 %
was reduced compared to pubic utility
2.815 2.799 -1 %
3
Withdrawal charge (HUF/m )
3
Storage working gas charge
(coefficient)
Storage peak charge
(coefficient)
3
Average price (HUF/m )
annual report 2009 | 37

hungarian energy office
HUF/GJ
3 500
3 000
2 500
2 000
1 500
1 000
500
0
Distribution charges
Customers without
gasmeter
Customers with a meter
3
of less than 20 m /h
nominal capacity
Customers with a meter
3
of 20-100 m /h (total)
nominal capacity
Customers with
3 101-500 m /h booked
capacity
3
Customers over 500 m /h
booked capacity
Small Consumers
(less than 20 m 3/h)
Medium Consumers
(20-100 m 3/h)
Large Consumers (with a gas
meter of 101-500 m 3/h)
Large Consumers (with a gas
meter of over 500 m 3/h)
Large Consumers connected
to transmission pipelines
From 1 January 2009 From 1 April 2009 From 1 July 2009 From 1 October 2009
Public utility end user average prices not
including VAT (HUF/GJ)
Change compared to the previous period
annual report 2009 | 38
Table 14 Change of the distribution charges in 2009
Base charge (HUF/year) or
3
Lump sum charge (HUF/m ) or
3
Capacity charge (HUF/m /h/year)
3
volume charge (HUF/m )
01.10.2008 01.10.2009 Change 01.10.2008 01.10.2009 Change
Base or capacity charge (average effect)
Natural gas tariff
Small Consumers
(less than 20 m /h)
Medium Consumers
(20-100 m /h)
Large Consumers (with a gas
meter of 101-500 m /h)
Large Consumers (with a gas
meter of over 500 m /h)
Large Consumers connected
to transmission pipelines
From 1
January
Small Consumers
(less than 20 m /h)
Medium Consumers
(20-100 m /h)
Large Consumers (with a gas
meter of 101-500 m /h)
Large Consumers (with a gas
meter of over 500 m /h)
Large Consumers connected
to transmission pipelines
From 1
Apri
came into force on 1 July 2009 (hereinafter system use decree),
the October modifi cation of which contains the change of
distribution charges.
The changes of system use charges in 2009 are summarized by
Tables 12, 13, and 14.
On the basis of the proposal of HEO, in order to promote the
use of storage (to lessen the dependence on imports) and to
0 0 - 11.390 12.078 6%
5 940 6 828 14.9% 7.65 7.584 -0.9 %
8 592 9 900 15.2% 7.1 5.804 -18.3 %
11 892 12 912 8.6% 3.78 0.812 -78.5 %
11 892 11 892 0.0% 0.53 0.845 59.4 %
Small Consumers
(less than 20 m /h)
Medium Consumers
(20-100 m /h)
Large Consumers (with a gas
meter of 101-500 m /h)
Large Consumers (with a gas
meter of over 500 m /h)
Large Consumers connected
to transmission pipelines
Figure 8 Quarterly development of the public utility (until 30 June) and the universal service
supplier (from 1 July) end user prices in 2009 (not including VAT)
Table 15 Quarterly public utility end user prices (until 30 June) and universal service
(from 1 July) average prices in 2009
From 1
July
From 1
October
3 082 3 082 3 200 2 814
0 % 0 % 3.8 % -12.1 %
handle the different fl exibility
of domestic and import feedin
points, varying entrance
charges were introduced for
each entry point from July 2009.
The reason for the increase of
the entrance charge was the
acknowledged justifi ed costs
of the investments carried out
by the transmission company.
The signifi cant decrease in the
transmission volume charge
was justifi ed by the change
(decrease) of the purchase price
of gas.
The decrease of the quantitybased
(HUF/m 3 ) charges on 1
July was partially allowed by
the decrease of the purchase
price of gas, and partially by
the transfer of the capital cost
element to the peak charge.
Accordingly, working gas and
peak charges increased.
In contrast to transmission and
storage charges, distribution
charges could change quarterly.
The above table compares the
level of 1 October 2009 with
that of 1 October 2008.
In the case of customers with
no metering equipment, the
distribution lump sum charge
is paid according to the type of
fl at. The reasons for the increase
of distribution charge is the
additional cost acknowledged
on the basis of the request of
the natural gas distribution
licensee TIGÁZ-DSO on
price revision and the ex-post
correction of the so-called
temperature-adjusted quantity
taken into account in the
calculation of charges, which
was based on the calculations of an independent expert.
In 2009, public utility and universal service end-user charges
exhibited the development shown in Figure 8.
The base charge increased by 15% for small and medium
customers, the capacity charge remained unchanged for
categories over a contracted capacity of 100 m 3 /h during the
year. The customers of the fi rst two categories paid a base
charge lower than the justifi ed amount, therefore the increase

GJ
30
25
20
15
10
5
0
Belgium
Bulgaria
Czech Republic
Denmark
Germany
Estonia
Ireland
Spain
France
Italy
Latvia
Lithuania
Figure 9 Comparison of natural gas tariffs to be paid by residential consumers with
annual consumption of 20 – 200 GJ in the EU27 (fi rst half of 2009)
/GJ
20
18
16
14
12
10
8
6
4
2
0
Belgium
Bulgaria
Czech Republic
Denmark
Germany
Estonia
Ireland
Spain
France
Italy
Latvia
Lithuania
Figure 10 Comparison of natural gas tariffs to be paid by non-residential consumers
with annual consumption of 100 000 – 1 000 000 GJ in the EU27 (fi rst half of 2009)
was necessary. The gas charge decreased during the year in
all customer categories. The decrease was 14% for small
customers, 18% for medium customers, 22% for customers
with a contracted capacity of 100 to 500 m 3 /h, and 16% for
customers with a contracted capacity of over 500 m 3 /h.
Public utility end user prices and the universal service average
prices decreased by 8.7% by the end of the year compared
to January 2009. The price and their changes in quarterly
breakdown are shown in Table 15.
Works in relation with price regulation, price
preparation
The preparation of the universal service prices and system use
charges that entered into force on 1 January 2010 took place
in 2009 on the basis of a cost-review.
Luxembourg
Luxembourg
Hungary
Hungary
Netherlands
Netherlands
Poland
Austria
Portugal
Poland
Romania
Portugal
Finland
Romania
Slovakia
Slovenia
Sweden
Slovakia
United Kingdom
Sweden
Croatia
United Kingdom
Turkey
Croatia
Turkey
annual report 2009
Profi t cap and profi t reimbursement
In the case of FGSZ Földgázszállító Zrt.,
the acknowledged costs of natural gas and
the real costs are signifi cantly different,
an additional 3 billion HUF should
have been taken into account during the
determination of the July 2009 charges.
However, the operational profi t of the
transmission company exceeded its cost
of capital, i.e. the additional costs were
covered by the revenues. Therefore, HEO
did not consider justifi ed the inclusion
of the almost 3 billion cost surplus at the
price modifi cation of July 2009.
With regard to E.ON Földgáz Storage Zrt.,
the profi t to be reimbursed to customers
was 251.8 billion HUF. This amount was
taken into account as a reduction during
the determination of the July charges
by decreasing the different charges to
the proportion of the justifi ed turnover
amount. (The profi t cap calculation
defi ned by the price regulation decree was
made in accordance with the Gas Act, i.e.
only the profi t of the public utility storage
activities of the company was subject to
investigation.)
Consideration of requests on price
reviews
In 2009, one price reviewing claim was
received by HEO from TIGÁZ-DSO
natural gas distribution licensee, which
related to the justifi ed cost of their gasmeter
replacement programme. This
corresponded to total acknowlegded
additional costs of HUF 341 million.
PUBLIC SERVICE OBLIGATION, CONSUMER
PROTECTION
Approval of codes
The publication of the new Gas Act was followed by the
issuance of the enforcement decree in 2009. The Business
Conduct Rules of licensees largely rely on the detailed
rules formulated in the enforcement decree; therefore it was
inevitable for licensees to prepare new Business Conduct
Rules after these detailed rules were published, and also for
HEO to carry out approval procedures regarding the new
codes. As a result, HEO accepted and approved 15 new Business
Conduct Rules in 2009.
annual report 2009 | 39

hungarian energy office
Service quality
With regard to the resolution of HEO issued for the
distribution licensees on 1 January 2004 and amended in April
2005, concerning the ‘determination of the minimum quality
requirements of natural gas distribution, and the expected
quality level of supply’, HEO issued 5 amendments to the
resolution for the fi ve licensees having the largest customer
base. New resolutions were issued for 3 licensees with smaller
client bases as well. The new and the modifi ed resolutions set
the required values of the operational reliability indicators for
the years 2009 and 2010.
Instead of issuing resolutions concerning the ‘determination of
the minimum quality requirements of natural gas distribution,
and the expected quality level of supply’, HEO issued a total
of 9 supply quality resolutions on client service in 2009 for
distribution licensees and universal service licensees. The
resolutions – in line with the directives that have already
worked out in the electricity industry – defi ne requirements
on personal, written, and phone-based customer relations.
Requirements can be classifi ed in three groups depending on
what consequences are drawn if they failed to be fulfi lled.
The fi rst group includes the minimum quality requirements
that – if not observed – lead to the imposition of fi nes. The
second group contains indicators in accordance with the
statutory provisions, and characteristic for the activities of
the licensee, defi ning expected quality levels of supply. The
third group contains the monitoring-type indicators, which
provide information for HEO
for the future fi ne-tuning of
the regulation. The maximum
amount of fi ne to be imposed
if requirements are not fi lfi lled
may be HUF 50 million, or
HUF 100 million depending on
the extent of discrepancy.
In 2009, HEO prepared for
the fourteenth time the study
measuring the satisfaction of
the customers with distribution
licensees and universal service
(public utility supply)
licensees. In the course of collecting the data,
the opinion of 7400 household consumers and
2400 industrial customers was surveyed. The
methodology of the survey was identical with
the procedure applied in 2008, thus the results
obtained can also be compared numerically,
directly. The transformation of the licensees –
although the content and the method is the same
– required HEO to issue 5 new resolutions in
order to establish the base of the survey.
The aggregated results suggest that 2009 did
not bring any signifi cant changes relative to
the trends perceived so far. The customers’
priorities are still the uninterrupted supply
and the precise consumption metering from
among the activities of the distribution
annual report 2009 | 40
licensees. The majority of customers were satisfi ed with these
services in 2009 as well. With regard to the responsibilities
of the universal service licensee, the quick and professional
administration at client services, understandable bills and
the availability of complaint possibilities were considered
important by customers. Similarly to the previous year, the
satisfaction values of understandability of bills, complaint management
and the availability of call centres lagged behind the
expected values.
Interruptions
The consumers expect continuous supply, i.e. a uninterrupted
availability of natural gas. Pipelined natural gas supply are
certainly accompanied by various coincidental or planned or
otherwise caused interruptions. Interruptions can be caused by
breakdowns on the one hand, and by maintenance or other
reconstruction works, on the other hand. The quality of the
physical process of pipeplined natural gas supply can be
assessed and demonstrated by the cause, time and duration of
interruptions.
The development of the number of interruptions is depicted
in Figure 11 based on the data of Table 16. The Figure
shows that the consumers were affected by the interruptions
to an increasing-decreasing extent. The proportion and
absolute number of the outages where the suppliers were
directly responsible increased in the fi rst half of the period,
Description/year 2000 2001 2002 2003 2004 2005 2006 2007 2008
Number of events causing
interruption
2 862 3 138 3 924 2 802 2 103 2 049 2 368 1 666 1 410
Within which: interruptions
due to breakdown
Number of interruptions
2 532 2 604 2 988 2 424 1 786 1 848 1 953 1 440 1 173
with direct responsibility
of suppliers
1 473 1 312 1 607 1 090 989 853 847 705 760
Within which: breakdowns
with direct responsibility
of suppliers
4500
4000
3500
3000
2500
2000
1500
1000
500
0
Table 16 Frequency of breakdowns
1 222 894 933 731 743 738 707 574 614
2000 2001 2002 2003 2004 2005 2006 2007 2008
Number of events causing interruptions
Number of interruptions with direct responsibility of suppliers
Thereof the number of breakdowns with direct responsibility of suppliers
Figure 11 Quantitative data of the events causing interruptions in natural gas
supply between 2000 and 2008 [pcs/year]

afterwards it continuously decreased.
The Figure also shows the frequency of
the breakdowns causing interruptions,
which is constantly lower than the total
frequency of interruptions.
The physical process of the pipelined
natural gas supply is labelled by the
specifi c indices calculated as the number
of events and the duration of consequent
interruptions per 1000 consumers.
Figures 12 and 13 show the frequency
and the duration of interruptions at a
national level. The specifi c number and
duration of the interruptions for the total
of interruptions are fl uctuating in the
observed period, while the events with
direct responsibility of the suppliers
have a smaller proportion and show a
continuous improvement.
Customer complaints
1.400
1.200
1.000
0.800
0.600
0.400
0.200
0
Total interruptions
The division of competencies between HEO and the Hungarian
Authority for Consumer Protection, which has been effective
in the electricity sector since 1 January 2008, took place in the
natural gas sector on 1 July 2009. Consequently, in the fi rst
half of 2009, it fell under the competency of HEO to judge
all customer complaints regarding natural gas distribution
licensees and public utility service licensees, independently
from the nature of the complaint and of
the customer. In the second half of 2009, 5.00
however, the management of customer 4.50
complaints concerning settlement,
4.00
invoicing, payment, metering,
suspension or disconnection of natural 3.50
gas supply due to payment delays, 3.00
and reconnection after the payment of 2.50
liabilities fell under the competency of
2.00
the Hungarian Authority for Consumer
Protection.
1.50
1.00
annual report 2009
2000 2001 2002 2003 2004 2005 2006 2007 2008
Interruptions with direct responsibility of the supplier
Interruptions with direct responsibility of the supplier, due to breakdowns
Figure 12 Number of the events causing natural gas interruptions per 1000 consumers
between 2000 and 2008 [pcs/1000 consumers/year]
A 23% decrease in customer complaints enabled HEO to
intensify its supervising activity. In 2009, the investigated
areas were the following: registration of the necessary
modifi cations in the registries after the change of customers
or after the authenticity meter replacement, and consequently
billing due to delayed registration, the content of the
information provided to the customers who wish to exit district
heat supply, the process of suspension of collection applied
during the procedure of investigations of complaints, and the
The number of consumer complaints 0.50
received by HEO in 2009 remained almost
unchanged following a decrease
0.00
2000 2001 2002 2003 2004 2005 2006 2007 2008
of 41.35% in 2008. The number of
Total interruptions
complaints grew from 1841 to 1877,
Interruptions with direct responsibility of the supplier
which correspond to an increase below
Interruptions with direct responsibility of the supplier, due to breakdowns
2%. On the basis of distribution of Figure 13 Duration of the events causing natural gas interruptions per 1000 consumers
cases detailed in chapter ‘Regulation
and operation of the electricity mar-
between 2000 and 2008 [hours/1000 consumers/year]
ket’ and Subchapter ‘Public service obligation and consumer advance bills issued due to the switching of traders. For some
protection’, 489 of the complaints affected licensees from the of the investigations, the evaluation of the data, information
natural gas industry. HEO launched supervisiory prodecures received is still in progress. During the investigations
for each complaint, and made the relevant resolutions in each closed by resolution, HEO did not fi nd any defi ciencies of
case. On the basis of the resolutions 46% of the complaints such magnitude that would have justifi ed the imposition of
concerning distribution licensees (mostly concerning breach fi nes. HEO has in several occasions imposed obligations
of contract), and 31% of the complaints concerning universal on the licensees affected by the investigation including the
service suppliers (mostly concerning billing issues) were transformation of workfl ows and the modifi cation of the
justifi ed on the side of the customer.
contents of the applied fi ll-in forms.
annual report 2009 | 41

hungarian energy office
REGULATION OF DISTRICT HEAT PRODUCTION
REGULATION
Licensing
The activities of district heat production and supply are still
subject to license. The establishment of district heat production
facilities is subject to license only over a heat output of 5
MW. Licensing competence is distributed between the local
governments and HEO. All district heat generators that also
generate electricity must apply for a license to HEO, while
district heat generating activity without electricity generation
falls under the authority of the local governments.
The licensing and supervision of district heat suppliers has
been transferred as a whole to the notary of local governments.
The tasks of consumer protection are provided for by the
inspectorates for consumer protection. The setting of consumer
tariffs remained within the authority of the representative
council of the local governments of settlements, and in the case
of Budapest, of the metropolitan municipality. Before setting
the tariffs, the Minister of Transport, Telecommunication and
Energy gave its opinion on the prices of district heat supply,
this, however, was abandoned from 1 July 2009, and the
District Heat Competitiveness Act (amending in this subject
the District Heat Act) extended the authority of HEO to the
price control of the district heat supply. HEO has a twofold
responsibility in the enforcement of the Act:
• To conduct the price control procedure initiated by the
district heat supplier with the purpose of changing the
district heat connection fee and the prices of the residential
district heat supply;
• Administrative control launched ex offi cio:
- to conduct a price control procedure at the district heat
suppliers to supervise the district heat connection fee and
the price of the residential district heat supply;
- to conduct a price control procedure that aims to
supervise the price determined in the contract of the
district heat producer and the district heat supplier.
District heat and electricity licensing procedure of power
plants under 50 MW
The licensing procedure of small power plants co-generating
heat and electricity (power plant with a nominal electric power
under 50 MW) is different for district heat and for electricity.
• District heat licensing procedure: in the case of the establishment
of a cogeneration equipment with a heat output
of 5 MW or above, the applicant has to apply to HEO for
a license for the establishment of a district heat production
equipment (below 5 MW heat output, the establishment
of a district heat production equipment is not subject to
license). After the establishment of the equipment and
following a successful test loading, the applicant has to
apply for an operational license for district heat production
irrespectively of the capacity.
annual report 2009 | 42
• Electricity licensing procedure: in the case of the establishment
of an electricity generation equipment (including
the establishment of a cogeneration equipment), if the
nominal electric capacity falls between 0.5 and 50 MW,
the applicant has to apply to HEO for a simplifi ed licence
for small power plants. The simplifi ed electricity
generation license relates to the selection of the primary
energy source of small power plants and to the electric
energy generation.
In the case an electric capacity between 0.5 and 50 MW and
in the case of the establishment of power plants based on
combined cycle electricity generation (co-generation) with a
nominal heat output of 5 MW or above, the power plants have
to submit the following applications to HEO in the following
chronological order:
In the period of selecting the primary energy source:
Simplifi ed license for small power plants (on basis of the
Electricity Act)
Before establishment:
License for the establishment of district heat production
equipment (based on the District Heat Act)
After commissioning:
Operational license for district heat production (based on the
District Heat Act)

Licensing activity of the HEO in 2009
In 2009, HEO issued 12 resolutions on district heat licensing.
From among these resolutions, 4 were operational licenses for
district heat production, 2 prolonged establishment licenses,
4 modifi ed existing operational licenses, 2 were approval of a
demerger or acquisition of controlling interest. HEO published
the resolutions in all cases.
COMPETITION
District heat supply is a local public utility service bound to the
pipeline system. One supplier operates in one area; therefore
competition among suppliers for the customers is not possible.
Only a limited competition can be imagined in district heat
production, primarily by the introduction of cogeneration, or
in the case of customer switching, when a customer switches
to another heating method, but it is still a limited possibility.
More and more owner-occupied blocks are breaking off the
district heat system because of the discontentment experienced
concerning the price and occasionally the quality of the district
heat supply.
District heat suppliers supply thermal energy to household
customers at administrative prices determined by the
representative council of the local government. Thermal
energy is purchased from district heat producers (power
plants) and/or produced in boilers by the suppliers themselves,
more and more frequently using cogeneration equipment. The
number of settlements where the supplied thermal energy
derived at least partly from power plants co-generating heat
and electricity was more than 60. District heat production
increasingly uses the economic advantages of co-generation,
which is further enhanced by the feed-in obligation of
electricity and the associating subsidy to the administrative
price. In the case of co-generating small power plants the
obligatory feed-in will expire at the end of 2010 and in the
cases where HEO did not extend the feed-in period because
of the return of the investment, this can affect the price of the
district heat produced.
At the same time the competitiveness of district heat supply
compared to central heating may be signifi cantly improved by
the fact that the VAT has been reduced to 5% from 2010.
SECURITY OF SUPPLY
The regionally competent local governments - in the capital,
the metropolitan municipality - are obliged to ensure through
a licensee or several licensees the district heat supply of
facilities that are supplied by district heat.
Most of the district heat supply companies are owned by local
governments and there are some places, where the district heat
producer (a power plant subject to electricity license) has also
acquired some shares of the district heat suppliers. In some
settlements, however, the district heat supply company is
operated by private companies based on a concession contract.
annual report 2009
In those cases, when a district heat supplier buys the majority
of the district heat from a power plant, and the power plant is
privately owned or indirectly state-owned, the possible debates
between the supplier and the power plant may jeopardize
supply. In these debates, HEO may act as a mediator, but the
debates can only be solved by the cooperation of the producer,
the supplier and the local government. The recent years
witnessed an effort evolving, where the local governments
tried to take measures to solve the problem of district heating
through the local government’s own company or own supplier.
PRICE PREPARATION, PRICE REGULATION
The heat production prices are uncontrolled. The charge of
joining the district heat supply and the charge of household
district heat supply is determined by the representative council
of the local government in a municipal regulation. Before the
determination of the price the minister responsible for energy
affairs delivered his opinion on the prices of district heat
supply. This process was modifi ed from 1 July 2009 in such a
way that suppliers submitted their proposal on price increase
to HEO. The representative council can approve the proposal
on price increase depending on the resolution of HEO.
In 2009 the district heat suppliers submitted proposals on
price change of district heat price for 25 settlements. Most of
the proposals intended to decrease the charge. 19 cases were
closed with resolutions in 2009, thereof one proposal was
refused, the intention of which was to increase the charge.
PUBLIC SERVICE OBLIGATION AND CONSUMER
PROTECTION
The regionally competent local government is responsible
for ensuring the district heat supply of the establishments
supplied with district heat. Most of the district heat supply
companies are owned by local governments; the licensing
authority is the notary of the local government; the heat prices,
charges are determined by the representative council of the
local government, therefore the entire chain is in the hands of
the local government, except for the power plant generation
of district heat.
In order to ensure the transparency of district heat supply,
the enforcement decree of the District Heat Act defi ned the
types of fi nancial data and the according technical data to
be published by the district heat suppliers. In the interest of
the better informing of the household consumers, district
heat suppliers supplying 1000 or more fl ats had to create an
information system (webpage).
The regional consumer protection inspectorates of the
Hungarian Authority for Consumer Protection are responsible
for consumer protection affairs.
annual report 2009 | 43

hungarian energy office
ENERGY SAVING, ENVIRONMENTAL PROTECTION
ENERGY SAVING
The Government Decree 1107/1999 (8.11) determines
the energy saving and energy effi ciency strategy of the
Government till 2010. Based on this strategy, the National
Energy Saving Program started in 2000. This program helped
the implementation of energy saving projects of consumers
and the district heat sector with direct subsidies and soft loans.
Energia Központ Kht. (Energy Centre Non-Profi t Company)
was created for the execution of the annually announced
Energy Saving Programmes.
HEO cooperates in the implementation of the Government’s
strategy of energy saving and energy effi ciency. As an expert
it takes part in the work of the interministerial committee that
awards the energy effi ciency improvement tenders, in the
work of the committee awarding the Environment and Energy
Operative Program schemes, as well as in the preparation of
the announcement of the tenders, and if required it provides
consultations on the tenders of modernisation of the suppliers
side district heat and the use of renewable energy sources.
Within the framework of the National Energy Saving Program
of 2009, in the residential programs of energy saving and use of
renewable energy sources (for individuals and communities),
a total of 3443 tenderers were awarded a support of 1.7 billion
HUF and a soft loan of 0.6 billion HUF in total. The program
allowed modernizing a total of 4.8 thousand homes at a total
cost of approximately 5.5 billion HUF.
The Operational Programme for
Environment and Energy, part of
the New Hungary Development
Programme, covering the period
2007 to 2013 and approved by the
European Commission indicates a
close relation between energy saving,
energy effi ciency improvement,
and environmental protection. The
two main goals of the programme
– in accordance with the Hungarian
and EU energy policies – are the following:
• Increased use of renewable energy sources, which will
affect the structure of energy sources in a favourable way,
i.e. to shift from the traditional energy sources towards
renewable energy sources.
• Improvement of energy effi ciency, this will contribute to
the improved security of supply, to soften the strong import
dependence of energy carriers and the mitigation of
environmental damages.
The realization of the objectives will help Hungary to comply
with its international undertakings. With this view, the National
Development Agency initiated 3 calls for tenders for the
period between 2007 and 2009, and then in 2009 11 further
calls for tenders for the years 2009 and 2010, which promote
annual report 2009 | 44
the improvement of energy effi ciency and the use of renewable
energy sources:
• The fi ve application schemes serving the use of renewable
energy sources provides HUF 30 billion support for the
years 2009 – 2010, the source of which is the budget of
the Hungarian Republic co-fi nanced by the European
Regional Development Fund.
• For the six application schemes concerning the
improvement of energetic effi ciency HUF 18.5 billion
is available for the two years as indicative amount, the
source of which is the budget of the Hungarian Republic
co-fi nanced by the Cohesion Fund.
The call for tenders of the remaining planning period will be
outlined on the basis of the results of the investments carried
out with the help of the support, and the experience gathered
from the application system.
ENVIRONMENTAL PROTECTION
Use of the renewable energy sources
The electricity production based on renewables increased
by 17% compared to the previous year, and exceeded 2660
GWh. This meant that the proportion of the green electricity
– calculated according to the methodology of the European
Union – increased to 6.42% from 5.2% in the previous year.
Table 17 Electricity produced from renewable energy sources in Hungary (GWh)
2002 2003 2004 2005 2006 2007 2008 2009
Hydro
194 171 206 203
Biogas 11.2 15.6 15 27
Wind 1.1 0.3 3 5.4 10
Biomass 0 75 655 1 612
Waste dump gas
Total 206.3 264.9 881.4 1 852
186 210
32 28
43 81
1 278 1 404
1 539 1 723
209 228.4
36 39.6
204 331.2
1 812 2 051.7
10 10.6
2 271 2 661.5
The major part (77%) of the renewable based electricity
production comes from the use of biomass. The amount
of electricity produced with biomass increased by 13.2%
compared to the last year, and exceeded 2050 GWh. In spite
of this considerable increase, the share of biomass in the green
electricity mix shows a continuous decline in the past years (in
2009 it fell by 3% compared to the previous year).
The shift in shares can be explained by the spreading wind
power plants. The share of wind increased to 12.4% within
the renewable electricity production. The electricity produced
from wind outshone the amount of the previous year by a
62.4% increase, and exceeded 330 GWh in 2009. Out of the
330 MW approved wind power plant capacity, 176 MW were
built by the end of 2009, the establishment of the remaining

3000
2500
2000
1500
1000
500
GWh
0
2002 2003 2004 2005 2006 2007 2008 2009
capacities can be expected by the end of 2010.
According to the Electricity Act, further wind
power capacities can only be established through
tendering. In 2009, HEO announced call for
tenders for further 410 MWs of wind power
plant capacity.
The share of hydro energy is 8.6% in the
green electricity. The electricity generated by
hydroelectric power plants increased by 9.3%
to 228 GWh in 2009. The electricity produced
from hydro power can be considered constant if
the effect of change in weather circumstances is
ignored.
The biogas-based electricity production exhibited
more than 10% increase in 2009. The near 40
GWh produced from biogas accounts for 1.5%
of the renewable-based electricity production.
The electricity produced from waste dump
biogas
Figure 14 Electricity produced from renewable energy sources in Hungary
annual report 2009
gas increased by 6% in 2009 and
reached 10.6 GWh, which is equal
to 0.5% of the total renewable-based
production.
It can be claimed that the amount of
electricity produced from renewable
energy sources is still exhibiting
growth in a year-to-year comparison
(in 2009 it exceeded the production
of the previous year by 17%); this
growth, however, falls short of (is
approximately half of) the rate that
was typical in the previous years.
Due to the world’s economic and
fi nancial crisis, new investments
became sluggish, erratic; in some
cases they were abandoned.
The promotion of renewable
resources is not solely important
for Hungary for environmental
and security of supply reasons, but it is also an
obligation in the Union, which is formulated in
Directive 2009/28/EC and Decision 2009/549/EC.
By 2020, Hungary has to increase the share of
renewable-based energy consumption in the total
energy consumption to 13%.
For the accomplishment of the above objectives
and on the basis of the request from KHEM, HEO
started the review of the promotion system of
renewable energy use in the Summer of 2009. The
review encompasses the economic calculations
of the renewable technologies as well as their
external benefi ts and costs, and the revealing of the
factors slowing down or impeding the licensing of
investments of renewables. Using the results of the
review, the aim of the project for 2020 is to prepare
a proposal on an optimal Hungarian renewable
annual report 2009 | 45

hungarian energy office
energy mix and a fi nancial assistance system promoting its
implementation. The results of the project contribute to the
preparation and implementation of the Renewables National
Action Plan (Megújuló Nemzeti Cselekvési Terv - NCsT) to
be submitted to the European Commission, and also to the
preparation of the regulation that adapts Directive 2009/28/EC
into the national law.
Greenhouse gas emission allowance trading
On the basis of Directive 2003/87/EC of the European
Parliament and the Council the facilities with a combustion
equipment of over 20 MW capacities may perform an activity
including carbon dioxide emission only in possession of
an allowance. The allowance trading system of the EU is
applicable to facilities producing electricity and district heat,
to oil refi neries, coking plants, to iron metallurgy and steel
production, cement-, lime-, glass- and construction material
production, as well as to paper mills.
annual report 2009 | 46
In the fi rst trading period – between 2005 and 2007 - the
Ministry of Environment and Water (KvVM) signifi cantly
over-allocated the allowances to market actors. In most of the
Member States of the European Union, a very similar situation
evolved, so the price of allowances – because of the excessive
offer of allowances – fell from the 30 Euro peak to 0.5 to 1
Euro in 2007.
In the 2008-2012 (so-called second) trade period Hungary
probably has to expect a shortage of allowances, primarily in
the electricity and district heat production sectors.
HEO as competent authority participates in the determination
of the total annual sulphur-dioxide and nitrogen-oxide emission
allowance of the power plants, and on the basis of Act 15 of
2005 on the trade of the greenhouse gas emission allowances
HEO contributes to determine the allowances for the new
entrants in the Allocation Plan. HEO only gives its positions
concerning the electricity production licensees; the allocation
authority is the National Inspectorate for Environment, Nature
and Water.

annual report 2009
OPERATION OF THE HEO, INSTITUTIONAL RELATIONS, PUBLICITY
INSTITUTIONAL AND INTERNATIONAL RELATIONS,
PUBLICITY
Bilateral institutional relations
In addition to HEO, other administrative bodies also perform
consumer protection tasks; HEO maintains – in accordance
with the practice of the previous years – regular relationship
with these bodies (Hungarian Competition Authority,
Ombudsmen, Parliamentary Commissioner for Data
Protection and Freedom of Information, Hungarian Authority
for Consumer Protection), and performed its work in
coordination with those. The cooperation with the Hungarian
Authority for Consumer Protection was even closer than in
the previous year, as the division of competencies, which took
place in the electricity sector on 1 January 2008, and in the
natural gas sector on 1 July 2009. From 1 July 2009, HEO
provides continuous professional support for the Hungarian
Authority for Consumer Protection in the management of
diffi cult customer complaints not only on electricity licensees,
but also on natural gas licensees. The competency rules were
made more unambiguous by the amendments of the Electricity
Act and the Gas Act, therefore fewer discussions were needed.
Special attention was drawn to the defi nition of the forms and
content of the data supply, as the information on complaints
serves as a basis for the regulatory and supervising activities
of HEO. In order to be able to monitor the observance of the
prescribed requirements it is indispensable that the data supply
of the Hungarian Authority for Consumer Protection fi ts to the
statistical system according to which HEO collects the data,
and on the basis of which it evaluates the activities of the
licensees. HEO also has an active and continuous relationship
with non-governmental organizations of customer protection.
Within the framework of this relationship, non-governmental
organizations give their opinion on the Business Conducts
Rules and resolutions on the quality of supply, and participate
in the work of the Energy Interest Representation Board on
every occasion.
International relations
HEO is member of the Council of European Energy Regulators
(CEER) and the European Regulators’ Group for
Electricity and Gas (ERGEG), which is operating as the
offi cial advisory body of the EU Commission. The employees
of HEO actively took part in the work of several working
groups and subcommittees of the CEER and ERGEG in 2009,
therefore they directly obtained information regarding the
questions and issues of European energy affairs (safety of
supply, sustainability, energy consumers), and they had the
possibility to represent the Hungarian interests during the
elaboration of the measures affecting the sector.
In addition to the above, from 2010, HEO delegates members
to the Renewable Energy Sources Concerted Action (RES
CA), which was established for the harmonic implementation
of the Directive on Renewables.
The President of the UN Working Party on Gas – which
performs data collection for the UN for gas storage, gas
transmission and security of supply studies – is one of the
employees of HEO.
HEO takes part in the work of the profession association of
the energy regulators of several countries of Central Eastern
Europe, Asia, and the Middle East, the Energy Regulators
Regional Association (ERRA). The president of ERRA is one
of the Directors of HEO, the Secretariat of ERRA operates in
the building of HEO.
From the sister authorities of the neighbouring countries, HEO
has good bilateral relationships with the Austrian E-control
and the Romanian ANRE.
The Energy Interest Representation Board (EÉT –
Energetikai Érdekképviseleti Tanács)
In 2009, the Energy Interest Representing Board held
semi-annual meetings with the participation of customers
and licensees. Magyar Energiafogyasztók Szövetsége
(The Association of the Hungarian Energy Customers),
Ipari Energiafogyasztók Fóruma (Forum of Industrial
Energy Customers) Országos Fogyasztóvédelmi Egyesület
(Association for Consumer Protection of Hungary) were the
permanent representatives of the customer’s side.
At the fi rst semi-annual meeting, EÉT reviewed the experience
of the gas crisis that occurred at the beginning of 2009, as well
as the connections between the European wholesale prices and
the Hungarian consumer prices.
The Agenda of the second semi-annual meeting of EÉT
included a report on the actual experience concerning the
introduction of the new gas market model, a report on the
experience gathered during the investigation of the electricity
outage of January 2009, as well as the pricing of the universal
natural gas service expected after July 2009.
CONDITIONS OF OPERATION
Financial Management of the HEO
HEO stands as a separate title in the budget of KHEM, it
receives state support for payment of the so-called income
supplements; the support was centrally determined and
obligatory. The extent of revenues of HEO and the procedures
of collection are regulated by KHEM Decree 30/2008 (31.10)
on the Service Fees of the Hungarian Energy Offi ce and the
Rules of Payment of the Administrative Service Fee and the
Supervision Fee, and GKM Decree 91/2007 (20.11) amended
by KHEM Decree 6/2009 (28.02). HEO is an independently
operating, fi nancially autonomous central administrative
body, that has full authority in managing his budgetary
annual report 2009 | 47

hungarian energy office
appropriations, and has chapter-level budgetary rights. In
accordance with Act 105 of 2008, in terms of its operation
it is a general government unit with offi cial authority. In
accordance with Act 57 of 2006, as of 1 July 2006 it is a
government offi ce.
The approved headcount of HEO was 94 in 2009, which
represents an increase of 10 persons in accordance with section
6/e of Government Decision 2155/2008 (5.11) and Section 1
of Government Decision 2180/2008 (20.12). The graduate
experts have technical, economic, fi nancial, legal knowledge,
most of them passed language exams, and they have a
substantial industrial experience. HEO is well-equipped, and
it is adequately provided with computers, telecommunication
and offi ce devices.
The Financial Management of HEO is balanced, the
revenues cover the expenditures necessary for operation,
the information technology developments, as well as the
expenditures necessary for the realisation of investments,
renewals, and maintenance in connection with the operation
of the offi ce building.
The organisational chart of HEO in 2009 is shown in Figure 15.
Information Technology, Information Processing
Information Technology
The professional and closed handling of information lawfully
received by HEO and sometimes also containing business
secret is essential for keeping the confi dence of data supplying
licensees. HEO has joined the Client Gate and the Offi ce Gate
as well. In order to comply with Govt. Decree 84/2007 (25.04)
on ‘The Safety Requirements of the Central Electronic Servi-
annual report 2009 | 48
Energy Interest
Representation
Board
Presidential
Advisory Board
Directorate of Energy
Supply and Consumer
Protection
Department of
Electricity Licensing
and Supervision
Department of Gas
Licensing and
Supervision
Department of District
Heating Licensing
and Supervision
Department of
Consumer Protection
PRESIDENT
Vice-President
Directorate of Pricing
and Economic Analysis
Department of
Price Preparation
for Electricity
Department of
Price Preparation
for Gas
Department of
Economic Research and
Environmental Protection
Department of Energy
Information and IT
ce System and the relevant systems’ and with Govt. Decree
223/2009 (14.10) repealing the former, the security questions
related to data handling were investigated in HEO. The data
security meets the requirements thank to the new internal
rules issued in connection with the handling of data, to their
enforcement, and to the operation of adequate information
security systems.
The increase of stored and processed data and the higher level
information security aspects have made it necessary to create a
new data storage system that is more secure than the previous
one. Parallel to the creation of the fast, secure, redundant data
storage, the saving system was also renewed.
The types of information necessary for the performance of
the tasks of HEO include data of daily, monthly, quarterly,
semi-annual, and annual frequency concerning the supply
of electricity and natural gas, and the production of district
heat. By the coming into force of the full market opening, the
responsibilities of HEO and the data necessary for meeting
those responsibilities have changed – fi rst for the electricity
sector, and then for the natural gas sector. The number of
data suppliers increased, the types of licenses changed, the
circle of data suppliers was altered. As a consequence of the
modifi ed rules and regulations, it was necessary to change
the data demands of HEO. The modifi ed data demands were
prescribed for the licensees by HEO in new resolutions.
The regularly submitted information concerning the
operations and activities of the licensed companies is received
directly, electronically through a data acquisition interface
located in the website of HEO. The receipt and storage of the
data take place entirely through this interface. In 2009, this
corresponded to the receipt, verifi cation, and storage of more
than 20.000 data forms.
Directorate
of Finance and
Human Resources
Secretariat
Internal
Controller
Directorate of
Legal and
Management
Figure 15 Organizational structure of the Hungarian Energy Offi ce in 2009

DATA
1. NATIONAL ENERGY CONSUMPTION DATA
National Energy Use
100%
90%
80%
70%
60%
50%
40%
30%
20%
10%
0%
1990 1995 2000 2005 2006 2007 2008**
National gross use 1 244.2 1 067.1 1 036.1 1 153.2 1 152.0 1 125.4 1 126.3
of which: primary electricity 250.4 166.0 178.0 173.9 173.5 175.6 177.1
of which: nuclear 137.3 140.3 141.8 150.8 146.7 160.0 161.5
hydro and wind 1.8 1.6 1.8 0.7 0.8 1.2 1.5
import 111.3 24.1 34.4 22.4 26.0 14.4 14.1
Use of fuel for electricity production 217.0 243.3 234.7 245.4 241.7 262.0 266.7
Total natural gas use 373.2 384.1 404.3 506.2 481.1 447.7 442.7
of which: power plants 73.9 68.3 77.0 127.4 132.7 144.5 148.7
Energy use supervised by the HEO* 766.7 725.1 740.0 798.1 763.6 740.7 737.8
Share of energy use supervised by the HEO (%) 61.6 68.0 71.4 69.2 66.3 65.8 65.5
* Primary electricity + fossil fuel usage of the electricity sector + total natural gas usage - natural gas usage of the electricity sector
** Factual data from 2008
*** Preliminary data
Proportion of National Energy Consumption Supervised by the HEO (indicated below by H)
1990 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Primary electricity (H) Natural gas (H)
Fuel used for electricity generation excluding natural gas (H) Solid and liquid energy carriers not supervised by the HEO
annual report 2009
2009***
1 040.0
190.0
168.1
2.0
19.9
218.1
385.6
106.0
687.7
66.1
Table 1.1
(PJ)
Figure 1.1
annual report 2009 | 49

hungarian energy office
GDP, Electricity Consumption and Total Energy Consumption; 1970 = 100%
%
300
250
200
150
100
50
0
1970 1972 1974 1976 1978 1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010
GDP % 1970 = 100 Electricity consumption % 1970 = 100 Total energy consumption % 1970 = 100
annual report 2009 | 50
Figure 1.2

2. INTERNATIONAL ENERGY CONSUMPTION DATA
Final Consumption of Total Energy per GDP* in Some European Countries in 2009
* In equivalent oil-tonnes: 1 toe = 41 866 MJ
** Calculated in constant 2005 euros
Energy Consumption per Capita in Some European Countries, 2009
toe/capita
5.5
5
4.5
4
3.5
3
2.5
2
1.5
1
0
Countries (toe/EUR**)
Austria
Belgium
Czech Republic
Denmark
United Kingdom
Finland
France
Greece
Netherlands
Ireland
Poland
Hungary
Germany
Italy
Portugal
Romania
Spain
Sweden
Slovakia
Slovenia
105
118
244
70
74
156
92
97
114
70
213
207
102
97
124
256
101
111
252
165
annual report 2009
Table 2.1
Figure 2.1
annual report 2009 | 51

hungarian energy office
Trend of Natural Gas Consumption in Some European Countries (2000 = 100 %)
50
45
40
35
30
25
20
15
10
5
0
%
Countries 2000 2005 2006 2007 2008
2009
Austria
Belgium
Czech Republic
Denmark
United Kingdom
Finland
France
Greece
Netherlands
Ireland
Poland
Hungary
Germany
Italy
Portugal
Romania
Spain
Sweden
Slovakia
Slovenia
annual report 2009 | 52
100 121 111 105 111 112
100 102 107 104 105 101
100 104 104 100 103 97
100 103 103 101 101 97
100 96 92 88 90 82
100 86 98 108 112 100
100 104 100 96 100 92
100 189 216 223 263 328
100 97 95 89 93 95
100 92 99 99 105 99
100 120 120 121 124 119
100 120 111 97 97 92
100 108 109 107 104 100
100 111 106 104 104 102
100 165 169 182 179 171
100 113 116 101 94 76
100 147 127 133 132 123
100 115 118 122 119 113
100 89 86 81 81 79
100 115 112 113 109 …
Proportion of Domestic Natural Gas Consumption in the Total Energy Consumption of Some European
Countries in 2009
Table 2.2
(%)
Figure 2.2

Proportion of Domestic Electricity Consumption of the Total Energy Consumption in Some European
Countries in 2009
Electricity Consumption per Capita in Some European Countries in 2009
kWh/capita
16 000
14 000
12 000
10 000
8 000
6 000
4 000
2 000
0
Countries (%)
Austria
Belgium
Czech Republic
Denmark*
United Kingdom
Finland
France
Greece
Netherlands
Ireland
Poland
Hungary
Germany
Italy
Portugal
Romania
Spain
Sweden
Slovakia
Slovenia
18.75
17.84
17.14
18.92
19.99
26.29
22.74
21.00
14.44
18.99
14.74
15.49
18.42
18.46
21.71
14.35
22.68
31.80
16.75
19.65
annual report 2009
Table 2.3
Figure 2.3
annual report 2009 | 53

hungarian energy office
Development of the International Crude Oil and Natural Gas Prices; 1990 = 100%
%
450
400
350
300
250
200
150
100
50
0
1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010
annual report 2009 | 54
Brent average price (FOB) Average price for imported natural gas in the EU(15)
Figure 2.4

3. ACTIVITIES OF THE HEO
The Number of Resolutions Issued by the HEO
1994 - 2009
combined
of which:
2000 2005 2006 2007 2008
Licensing 2 576 78 116 400 364 285
-licenses issued 1 004 16 24 247 188 106
-further regulations with relation
to licensing
1 572 62 92 153 176 179
Consumer protection 1 174 16 158 128 99 221
-approval of regulations 844 14 118 88 82 121
-standard of supply 330 2 40 40 17 100
Price setting, price revision 199 5 8 12 7 4
Public disclosure of data 1 003 - 101 20 21 476
Other 950 10 123 241 123 67
Total 5 902 109 506 801 614 1 053
The Number of Cases, Complaints Investigated by the HEO
Total complaints 12 437 445
-electricity supply 8 180 306
1 227 1 075 2 197
897
761 1 354
of which: network development 267 9 8 24 22
problems of billing and metering
equipment
3 428 50
unlawful acquisition of electricity 2 363
188
other 2 122
-gas supply 4 257 139
59
398
161
330
330
431 941
101 62
205 329
314 843
of which: network development 416 6 36 24 18
problems of billing and metering
equipment
1 890 68
unlawful acquisition of natural gas 833 39
other 1 118 26
147
178 482
21 21 112
126
91 231
Other cases 5 156 265
198 119 942
647
Transferred to the Hungarian Authority for
Consumer Protection 657 329
Total 18 250 710
of which:
1994 - 2009
combined 2000 2005 2006 2007 2008
1 425
1 194
annual report 2009
865
233
12
87
60
74
632
6
265
205
156
3 139 1 841
2009
388
134
253
109
89
20
68
134
154
853
2009
921
420
Table 3.1
(pc)
annual report 2009 | 55
7
81
220
112
501
2
209
167
123
628
328
1 877
Table 3.2
(pc)

hungarian energy office
4. DATA ON ELECTRICITY INDUSTRY SUPERVISED BY THE HEO
Free Market Model, 2009
Hungarian State
Local authorities
Price Supervised
Investors with majority foreign
shareholders, registered in
Hungary
Foreign investors
annual report 2009 | 56
Universal
Supplier(s)
Generators
Consumers Entitled to
Universal Supply
Proprietors Generators
Investors with majority Hungarian
shareholders, registered in
Hungary
of which: MVM Zrt.
Total Hungarian capital interest
Total foreign capital interest
Unregistered
TOTAL
Planned course of electricity flow
Transmission
System
Operator
Electricity
Traders
Distributors
Consumers
Import-
Export
Course of electricity flow
Breakdown of the Registered Capital According to Proprietary Categories in the Electricity Sector
as of December 31st 2009
Universal
Suppliers
Organised
Market
Traders Total
0.00
0.01 -
0.00
2.18 0.65
0.22 -
0.87 0.41 0.23
58.48 99.99 - 10.99 15.14 25.06
57.30 99.99 - 9.20 0.21 27.37
58.70 100.00 -
11.86 17.73 25.94
12.40 100.00 6.39 11.74 39.04
28.90 -
81.75 68.36 34.37
41.30 - 100.00 88.14 80.10 73.41
0.00
-
0.00 2.18 0.65
100.00 100.00 100.00 100.00 100.00 100.00
Figure 4.1
Table 4.1
(%)

Companies with Operational Licenses for the Electricity Industry, as of the 31st of December 2009
System Operator
Electricity Generators*
AES Borsodi Energetikai Kft.
ISD POWER Kft.
MVM GTER Kft.
Combined Small Power Station Generation Licensees
293
AES Borsodi Energetikai Kft.
BKV Trade Kft.
AES Borsodi Energetikai Kft.
B.E.K. Group Kft.
Central European Energy Trade Kft.
Coal Energy Budapest Kft.
Elektra Energia Kft.
Enel Trade Hungary Kft.
ENERGO-PARTNER Kft.
ALPIQ ENERGY SE
Energy Clearing Counterparty
E.ON Energy Trading SE
Essent Trading International SA
EXEN s.r.o.
Ezpada s.r.o.
Electricity Traders
Distribution Licensees
Private Line Operational Licensees
Universal Supplier Licensees
GEN-I Budapest Kft.
JMT ENERGY Kft.
MT Consulting Kft.
PANNONTRADING KFT
PCC Energie Kft.
Rudnap-Hungary Kft.
Limited Electricity Traders
KORLEA INVEST a.s.
RE Trading CEE s.r.o.
S.C. TINMAR-IND S.A.
Tisza Joule Kft.
* Companies operating a power plant with a minimum installed capacity of 50 MWs.
Simplified Electricity Trader
annual report 2009
Table 4.2
annual report 2009 | 57

hungarian energy office
The Yearly Average Statistical Number of Employees of Electricity Companies
1990 1995 2000 2005 2006 2007 2008 2009
TOTAL 38 460 43 693 29 910 19 852 18 299 12 844 12 960 11 596
of which: electricity generation companies*
electricity transmission, distribution
and system operation companies
* Companies operating a power plant with a minimum installed capacity of 50 MW
annual report 2009 | 58
1990 1995 2000 2005 2006 2007 2008
Installed capacity 7 177 7 288 7 855 8 588 8 620 8 846 9 100
Available capacity 7 065 6 982 7 601 8 080 8 197 8 253 8 476
Usable capacity 5 376 5 618 6 591 7 021 6 984 7 190 7 258
Actually usable capacity 5 286 5 468 6 349 6 741 6 625 6 872 6 979
Peak-power station load 3 635 4 383 4 425 4 457 4 529 5 107 5 816
Import-Export balance 1 751 415 465 945 1 002 559 572 1 009
Maximum peak load 6 534 5 731 5 742 6 439 6 432 6 602 6 388 6 380
2009
9 163
8 359
7 128
6 994
5 371
Table 4.3
Typical Capacities of the Hungarian Electricity System (annual average weekday peak*) Table 4.4
* Until 1995 weekdays, from 2000 annual average peak load of calendar days
23 997 17 626 10 269 9 838 9 726 9 509 9 137
19 696 12 284 9 400 7 816 2 611 1 861 1 861
Electricity Generation Capacity by Energy Source Used Table 4.5
1990 1995 2000 2005 2006 2007 2008
Coal 8 154 8 615 8 888 6 977 6 967 7 350 6 928
Hydrocarbons 5 249 10 174 10 958 12 803 13 511 15 784 15 672
of which: gas engines - - - 2 034 2 627 2 748 3 133
Nuclear power 13 731 14 026 14 180 13 834 13 461 14 677 14 818
Hydro-power 178 163 178 203 186 210 213
Wind power - - - 10 43 110 205
Other renewable energy resources and waste 135 220 216 1 929 1 690 1 828 2 190
Total 27 447 33 198 34 420 35 755 35 859 39 959 40 026
2009
6 346
11 034
2 880
15 426
228
331
2 444
35 810
(capita)
(MW)
(GWh)

Energy Sources Used in Power Plants
1990 1995 2000 2005 2006 2007 2008**
Coal 124 395 113 963 114 711 83 519 79 524 83 813 83 762
Hydrocarbons 91 620 129 317 120 035 138 459 143 306 158 338 152 559
of which: gas engines -
-
- 18 750 24 511 25 178 26 470
Nuclear power 148 366 152 304 151 904 147 370 143 619 155 860 156 842
Hydro-power* 641 587 641 751 670 756 767
Wind power* -
-
-
36 156 395 737
Other renewable energy resources and waste 1 599 2 215 2 556 31 496 29 487 27 734 29 588
Total 366 620 398 386 389 847 401 631 396 762 426 896 424 255
* Power generated according to international accounting standards (MWh) * calculated with 3,6 MJ/kWh heat-equivalent.
** Some data from 2008 have been corrected
Line Length of Electricity Networks on 31st December*
Voltage levels 1990 1995 2000 2005 2006 2007 2008
High-voltage overhead lines 8 581 9 161 9 455
of which: 750 kV lines 268
268
268
400 kV lines 1 477 1 574 1 735
220 kV lines 1 251 1 244 1 188
120 kV lines 5 585 6 075 6 264
High-voltage cables 69
Medium-voltage overhead lines 50 461
75
102
9 649
268
9 787 9 802 9 836
268
1 904 2 000
1 187 1 187
6 290 6 333
117
51 160 52 600 53 318
Medium-voltage cables 9 501 9 683 10 166 11 576
Low-voltage overhead lines 55 728
57 516 60 076 62 212
Low-voltage cables 20 277 20 516 21 321 21 401
Low-voltage overhead lines and cables,
in total
76 005 78 032 81 397 83 613
Line length, in total 144 617 148 111 153 720 158 273
* Some data between 2005 and 2008 have been corrected
Network Development Investments at the Electricity Suppliers (Distributors)
Total network development
investments started in the
actual year
of which: network development
contributions by
consumers
Network development
investments finished in the
actual year
Length of distribution network
set into operation in the actual
year
123
268
2 000
1 187
6 347
132
annual report 2009
268
2 038
1 187
6 343
134
53 527 53 663 53 691
11 769 11 967 12 251
62 612 63 030 63 376
21 845 22 584 22 457
84 457 85 614 85 833
159 663 161 179 161 743
Units 1996 2000 2005 2006 2007 2008
(million HUF) 20 455
(million HUF) 4 182
(million HUF) 21 107
(km) 1 197
50 636 48 392 57 493 75 514 77 467
9 692 8 805 11 148 10 000 10 238
49 214 53 815 54 742 76 812 72 440
1 667 2 517 2 374 2 070 1 778
2009
71 137
113 015
25 089
162 508
822
1 192
34 398
383 072
2009
9 818
268
2 116
1 187
6 247
134
53 807
12 438
63 569
22 744
86 312
162 509
2009
74 798
8 613
72 440
1 778
Table 4.6
(TJ)
Table 4.7
(km)
Table 4.8
annual report 2009 | 59

hungarian energy office
Data on Breakdowns as Reported by the Distributors*
A Summary of breakdown indices
annual report 2009 | 60
Denominations Units 2007 2008
2009
Electricity outage MWh
Electricity (available) GWh
Outage index
Number of consumers 1000 pc
Outage per consumer kWh/costumer
B High-voltage operational safety indices
Length of network 100 km
Number of breakdowns
Number of breakdowns per network length pc/100 km
C Medium-voltage operational safety indices
Number of breakdowns pc
Number of primery fuse faults pc
Number of network breakdowns, total pc
Number of overhead line network breakdowns pc
Number of underground cable network breakdowns pc
Duration of restoration of breakdowns of medium-voltage networks hours
Duration of restoration of breakdowns of overhead line network hours
Duration of restoration of breakdowns of underground cable network hours
Specific duration of restoration of network breakdowns hours/pc
Specific duration of restoration of overhead line network breakdowns hours/pc
Specific duration of restoration of underground cable network
breakdowns
hours/pc
* Data on the years 2007 and 2008 were submitted together with the data on the year 2009
Number of Electricity Consumers*
Total
of which: households
other
of which: manufacturing branches
non-manufacturing branches
* Data on the year 2008 have been corrected
pc
Three
year
average
4 178 3 162 2 944 3 428
38 605 38 613 36 371 37 863
0.108 0.082 0.081 0.091
5 464 5 523 5 550 5 512
0.765 0.572 0.531 0.622
70.045 70.110 70.267 70.141
11 9 12 11
0.157 0.128 0.171 0.152
7 617 6 978 7 435 7 343
1 295 1 347 1 707 1 450
6 322 5 631 5 728 5 894
5 138 4 568 4 555 4 754
1 184 1 063 1 173 1 140
12 820 10 899 11 378 11 699
11 420 9 605 9 971 10 332
1 400 1 294 1 407 1 367
2.028 1.935 1.987 1.985
2.223 2.103 2.189 2.174
1.182 1.217 1.199 1.199
1990 1995 2000 2005 2006 2007 2008 2009
4 784
4 375
409
87
322
5 019 5 122 5 348
4 563 4 654 4 987
456 468 361
92 102
89
364 366 271
5 362
5 013
349
93
256
5 470
5 105
365
104
262
5 488
5 103
385
91
294
5 548
5 182
366
84
282
Table 4.9
Table 4.10
(1000 pc)

Sale of Electricity by Universal Suppliers
annual report 2009
2008 2009
Total electricity sold to all costumers 12 801 13 925
of which: at general, all day tariff ("A1") 10 604 10 650
of which: at discounted price available for active employees or pensioners of
the electricity industry
270 215
at general, two zone time tariff ("A2") 62 129
public institutions tariff ("A3") 0 975
at seasonal (controlled) tariff ("B") 2 135 2 170
Electricity sold to domestic costumers 11 460 11 235
of which: at general, all day tariff ("A1") 9 385 9 098
of which: at discounted price available for active employees or pensioners of
the electricity industry
270 215
at general, two zone time tariff ("A2") 0 0
at seasonal (controlled) tariff ("B") 2 075 2 137
Electricity sold to non-domestic costumers 1 341 2 690
of which: at general, all day tariff ("A1") 1 219 1 553
at general, two zone time tariff ("A2") 62 129
public institutions tariff ("A3") 0 975
at seasonal (controlled) tariff ("B") 60 34
Data on Electricity Sold by Electricity Traders*
Electricity purchased, in total
of which: from domestic generators
from transmission system operator regarding the
obligatory feed-in scheme
from public utility wholesaler
from other electricity trader
import
other procurement
Electricity sold, in total
of which: to eligible consumers (to end-users)
to universal suppliers
to domestic generators
to public utility wholesaler
to other electricity traders
export
other sales
2003
6 274
536
558
1 642
3 336
203
6 274
3 094
250
1 642
1 272
17
2004
12 070
1 698
1 982
3 062
5 174
154
12 070
6 808
3 062
152
1 756
292
2005
22 800
2 858
6 508
7 501
5 727
205
22 800
11 385
256
7 501
3 384
274
2006
28 122
3 972
6 508
9 684
7 707
251
28 122
12 993
503
9 684
4 771
171
2007
35 290
3 400
5 092
16 725
9 864
210
35 290
7 916
214
16 725
10 247
189
2008**
82 781
29 970
4 149
34 346
14 178
138
82 781
23 281
11 130
284
34 346
9 198
4 541
2009
111 179
24 990
4 252
66 760
15 125
53
111 179
20 930
10 400
* According to data on electricity industry licensees, starting 2008 this also includes data from MVM Trade Villamosenergia Kereskedelmi Zrt.
** Some data from 2008 have been corrected
66 760
9 557
3 533
Table 4.11
(GWh)
Table 4.12
(GWh)
annual report 2009 | 61

hungarian energy office
Purchase of Electricity of the Eligible Consumers*
Electricity purchased, in total
of which: from domestic generators
from electricity traders
import
* Data for 2008 cover all end-users of the electricity market.
Indices of the Concentration Ratio of Electricity Generation and Sales*
Electricity - Sales
Number of companies (pcs)
Number of companies with at least 5% market share (pcs)
Share of companies with at least 5% market share (%)
Top 3 suppliers’ total market share (%)
HHI-Index**
Electricity - Generation
Number of licensed generators*** (pcs)
Number of companies with at least 5% output share (pcs)
Share of companies with at least 5% output share (%)
Top 3 generators’ total (installed) output share (%)
Total output share of the largest company (%)
HHI-Index**
Electricity Generation Capacity
Number of licensed generators*** (pcs)
Number of companies with at least 5% capacity share (pcs)
Share of companies with at least 5% capacity share (%)
Top 3 generators’ total (installed) capacity share (%)
Total capacity share of the largest company (%)
HHI-Index**
annual report 2009 | 62
2003 2004 2005 2006 2007 2008 2009
3 904 7 106 11 517 13 103 8 043 23 350 20 961
253 142 132 110 127 69 31
3 094 6 808 11 385 12 993 7 916 23 281 20 930
556 155 - - - - -
2000 2005 2006 2007 2008 2009
6 17 19 19 26 35
6 8 8 7 8 7
100 87 85 83 74 70
65 42 48 51 50 46
1 889 1 142 1 136 1 291 867 951
2 000 2 005 2 006 2 007 2 008 2 009
12 12 12 12 12 12
5 3 4 5 6 3
86 65 68 74 77 66
72 65 63 63 61 66
40 39 37 37 37 43
2 257 2 057 2 027 1 990 2 023 2 252
2 000 2 005 2 006 2 007 2 008 2 009
12 12 12 12 12 12
4 4 4 4 4 4
69 61 58 64 62 62
58 51 49 57 52 52
26 20 21 25 22 22
1 632 1 460 1 640 1 577 1 466 1 140
Table 4.13
(GWh)
Table 4.14
* Data of the individual licensed companies were taken into account separately.
** Herfi ndahl-Herschmann Index: depending on the number of suppliers and the market share ratio of sales; in case of one supplier on the market, HHI = 10 000.
*** Excluding all combined small power station generation licensees.

Indicators of the Electricity Market
Number of Balance Cycles (pcs)
pc
60
50
40
30
20
10
0
2003 2004 2005 2006 2007 2008 2009
Consumption of the Open Competitive Market (GWh)
GWh
2 500
2 000
1 500
1 000
500
0
2003 2004 2005 2006 2007 2008 2009
annual report 2009
Figure 4.2.1
Figure 4.2.2
annual report 2009 | 63

hungarian energy office
5. DATA ON NATURAL GAS INDUSTRY SUPERVISED BY THE HEO
New Operational Model of the Natural Gas Market, from 1st of July 2009
Source
Domestic
Import
Proprietors
Hungarian State
Local authorities
Other Hungarian investors
Hungarian participation, in total
Investors with majority foreign
shareholders, registered in Hungary
Foreign investors
Foreign participation, in total
Unregistered
annual report 2009 | 64
Trader Possessing
Public Utility
Wholesalers’ Resources
Transporter
Gas
Storages System
Operator
Gasflow
Financial relations
Natural Gas
Storage
Natural Gas
Transporter
and System
Operator*
Natural Gas
Public Utility
Wholesaler
Traders
Universal
Service Suppliers
Distributors
Traders
Breakdown of the Registered Capital According to Proprietary Categories in the Natural Gas Industry
as 31st of December 2009
Natural Gas
Distributors and
Public Utility
Suppliers
Natural Gas
Traders
0.00 0.00 0.00 0.16 0.00 0.00
0.00 0.00 0.00 19.17 0.00 0.12
0.00 21.90 0.00 12.48 0.06 0.15
0.00 21.90 0.00 31.81 0.06 0.28
77.21 78.10 99.99 33.47 0.12 1.50
22.79 0.00 0.00 34.72 99.46 97.87
100.00 78.10 99.99 68.19 99.58 99.36
0.00 0.00 0.01 0.00 0.36 0.36
TOTAL
100.00 100.00 100.00 100.00 100.00 100.00
* Determined by the ownership structure of the proprietor MOL Nyrt.
End-users
Entitled for
Universal
Supply
End-users
on the Free
Market
Total
Figure 5.1
Table 5.1
(%)

Companies with Operational License for Gas Industry as of the 31st of December 2009
System Operator
FGSZ Földgázszállító Zrt.
Natural Gas Traders
BanKonzult Pénzügyi és Gazdasági Tanácsadó Kft.
BC Energiakeresked Kft.
CENTREX Zrt.
Csepeli Erm Földgáz Kereskedelmi Kft.
DBGÁZ Kft.
E.ON Energiaszolgáltató Kft.
E.ON Földgáz Trade Földgázkeresked Zrt.
EconGas Hungaria Földgázkereskedelmi Kft.
ÉGÁZ-DÉGÁZ Zrt.
ELECTRABEL Magyarország Kft.
ELMIB Zrt.
Els Magyar Földgáz- és Energiakereskedelmi
és Szolgáltató Kft.
ENERGY CAPITAL Energiakeresked Zrt.
Fgáz Gázkereskedelmi Kft.
FGÁZ Zrt.
GLOBAL NRG Kereskedelmi és Tanácsadó Zrt.
Hódmezvásárhelyi Vagyonkezel és Szolgáltató Zrt.
Hungaro Energy Kft.
ISD Dunaferr Dunai Vasm Zrt.
JAS Budapest Zrt.
MOL Energiakeresked Kft.
MOL Nyrt.
OTP Kereskedház Kft.
OTP TRADE Kft.
PANRUSGAZ Zrt.
Shell Hungary Zrt.
TIGÁZ Zrt.
UKRENERGY Trade Zrt.
Natural Gas Transporter
FGSZ Földgázszállító Zrt.
Natural Gas Storage Licensees
E.ON Földgáz Storage Földgáztároló Zrt.
MMBF Földgáztároló Zrt.
Natural Gas Distributors
Csepeli Erm Kft.
DBGÁZ Kft.
E.ON DDGÁZ Zrt.
E.ON KÖGÁZ Zrt.
ÉGÁZ-DÉGÁZ Földgázelosztási Zrt.
FGÁZ Földgázelosztási Kft.
ISD POWER Energiatermel és Szolgáltató Kft.
Magyar Gázszolgáltató Kft.
NATURAL GAS SERVICE Ipari és Szolgáltató Kft.
OERG Kft.
TIGÁZ DSO Földgázelosztási Kft.
Natural Gas Public Utility Suppliers
Csepeli Erm Földgáz Kereskedelmi Kft.
DBGÁZ Debreceni Gázszolgáltató Kft.
E.ON Energiaszolgáltató Kft.
ÉGÁZ-DÉGÁZ Zrt.
Fvárosi Gázmvek Zrt.
ISD POWER Energiatermel és Szolgáltató Kft.
OERG Ózdi Energiaszolgáltató és Kereskedelmi Kft.
TIGÁZ Tiszántúli Gázszolgáltató Zrt.
Pipeline LPG Distributors and Suppliers
PRIMAGÁZ-HUNGARIA Ipari és Kereskedelmi Zrt.
TIGÁZ DSO Földgázelosztási Kft.
TOTAL Hungaria Kereskedelmi Kft.
annual report 2009
Table 5.2
annual report 2009 | 65

hungarian energy office
The Yearly Average Statistical Number of Employees of Gas Supply
Companies
annual report 2009 | 66
1990 1995 2000 2005 2006 2007 2008 2009
Total 12 448 10 276 6 715 5 970 5 643 5 680 5 505 5 275
of which: distribution activity 3 342 2 657 2 712 3 203
public utility provider* 807 487 385 2 072
* in 2009 universal suppliers
Important (Year-End) Data on the Natural Gas Supply
2004 2005 2006 2007 2008 2009
Length of distribution network km 79 377 80 519 80 825 81 335 81 627 81 798
Number of consumers 1000 pc 3 295 3 364 3 428 3 477 3 515 3 527
of which: household consumers 1000 pc 3 106 3 166 3 224 3 270 3 306 3 317
Number of settlements connected
to the natural gas pipeline network
Number of settlements
connected in the actual year
Natural Gas (Peak Day) Load Data
National total
of which: distributors total
consumers directly supplied by
transmission pipeline, total
pc 2 858 2 871 2 887 2 891 2 892 2 895
pc 7 13 16 4 1 3
1990
54 923
42 606
12 317
1995
64 472
53 938
10 534
2000
73 658
65 878
7 780
2005 2006
91 665 89 006
75 600 78 655
16 065 9 936
2007 2008 2009
76 245 79 052 74 317
61 233 66 653 63 178
13 444 12 136 11 139
Table 5.3
(capita)
Table 5.4
Table 5.5
(1000 m 3 /day)

Resource
increase
741
Domestic
production
2 607
Captive,
non-residential
consumers
1 562
Domestic sales
10 935
Sales over distribution pipeline
8 316
Residential
consumers
3 653
Total sources
12 242
Sales over direct
pipeline
2 619
Non-residential
consumers
Captive
consumers
4 663 1 439
Open
market
3 101
Import
9 635
Open
market
1 180
Utilisatiion of
the producer
480
Export
86
annual report 2009
Natural Gas Flow Chart, 2009 Figure 5.2
(Mm 3 )
Indices of Concentration Ratio of Natural Gas Sales*
2000 2005 2006 2007 2008 2009
Number of undertakings (pcs) 10 16 15 22 20 25
Number of undertakings with at least 5% market share (pcs) 7 7 8 6 8 9
Share of undertakings with at least 5% market share (%) 99 93 96 78 86 87
Top 3 undertakings’ total market share (%) 68 62 62 52 44 38
HHI Index** 1 810 1 548 1 556 1 224 1 042 917
* Data have been corrected
** Herfi ndahl-Herschmann Index: depending on the number of suppliers and the market share ratio of sales; in case of one supplier on the market,
HHI = 10 000.
Table 5.6
(1000 m3 /day)
annual report 2009 | 67

hungarian energy office
Summary Data of LPG Pipeline Suppliers
Number of settlements connected to
LPG pipeline system
pc
Number of consumers pc
of which: household consumers pc
Total sales of LPG t
of which: for household consumers t
Sales revenues of LPG million HUF
of which: from household consumers million HUF
Length of distribution network km
of which: main pipelines km
annual report 2009 | 68
Units 2004 2005 2006 2007 2008
2009
28 18 17 17 17 14
3 452 1 631 1 633 1 624 1 617 1 553
3 134 1 505 1 505 1 487 1 484 1 454
2 676 2 562 1 490 982 976 1 140
1 766 1 330 830 433 363 396
334 393 237 203 278 260
213 243 121 94 114 95
205 98 98 98 98 98
150 73 73 73 73 73
Table 5.7

annual report 2009
6. DATA ON DISTRICT HEAT GENERATION SUPERVISED BY THE HEO
Companies with Operational License for District Heat Production
District Heat Producers
AES Borsodi Energetikai Kft.
Bakonyi Erm Zrt.
Budapesti Erm Zrt.
Csepeli Áramtermel Kft.
DKCE Debreceni KCE Kft.
Dunamenti Erm Zrt.
E.ON Energiatermel Kft.
ISD POWER Kft.
Paksi Atomerm Zrt.
PANNON Herm Zrt.
Vértesi Erm Zrt.
Small Power Stations Producing District Heat
Alfa-Nova Energetikai Fejleszt, Tervez és Vállalkozó Kft.
ALKALOIDA Vegyészeti Gyár Zrt.
Bajatechnik Energiaszolgáltató Kft.
Callis-R Energetikai Zrt.
Cellenergo Energiatermel és Távhszolgáltató Kft.
CHP-Erm Kft.
Dalkia Energia Zrt.
Dél-Energo Kft.
Dorog-Esztergom Erm Kft.
EnergiaBlokk Energiatermel és Szolgáltató Kft.
Energocoop Általános Energetikai Szolgáltató Kft.
Energo-Holding Energetikai, Kereskedelmi és Szolgáltató Kft.
ERM Fejleszt, Beruházó Kft.
FTÁV-KOMFORT Épületenergetikai Szolgáltató és Fvállalkozó Kft.
Fvárosi Közterület Fenntartó Zrt.
Ftés- Tüzeléstechnikai Kereskedelmi és Szolgáltató Kft.
Fzfi Erm Kft.
Füzít-GM Energiatermel Kft.
GASWEST Kft.
GM KÉRBEREK 30 Villamosenergia-termel, Kereskedelmi és
Szolgáltató Kft.
Summary Data on District Heating
Units 1990 1995 2000 2001 2002 2003 2004 2005 2006 2007 2008
Number of district heating systems pcs 328 298 244 240 236 239 250 266 271 268 269
Capacity of heat producing facilities MWth 18 817 16 389 12 487 12 551 12 027 12 050 11 655 10 271 9724 9 768 9 312
Number of homes connected to district
heating
1000 pcs 645 650 646 645 647 647 645 662 653 650 652
Proportional share of homes
% 16.6 16.4 15.8 15.7 15.8 15.7 15.5 15.8 15.5 15.5 15.4
connected to district heating
Small Power Stations Producing District Heat
GYRH Gyri Hszolgáltató Kft.
Halas-T Vagyonhasznosító Kft.
Heat Invest Kft.
Kaposvári Önkormányzati Vagyonkezel és Szolgáltató Zrt.
Kaptár "C" Energetika Szolgáltató Kft.
Kazinc - Therm Fterm Kft.
Kecskeméti TERMOSTAR Hszolgáltató Kft.
Keszthelyi Városüzemeltet Egyszemélyes Kft.
Kiserm PLD Energiaszolgáltató Kft.
Kiserm SRV 2005 Kft.
Komlói Fterm Zrt.
MESZ Mosonmagyaróvári Energia Szolgáltató Kft.
MIFÜ Miskolci Fterm Kft.
Mohácsi Hszolgáltató Kft.
Móri Htermel és Szolgáltató Kft.
MVM Észak-Budai Projekt Kft.
NYKCE Nyíregyházi Kombinált Ciklusú Erm Kft.
Ózdi Erm Kft.
Pannongreen Kft.
Pannon-Kogen Energetikai Termel Kft.
Perkons Kft. (Sárbogárd, József A. ftm)
Power Beruházási Kft.
QUALITEAM-CONSULT Kft.
Sinergy Energiaszolgáltató, Beruházó és Tanácsadó Kft.
Szegedi Hszolgáltató Kft.
Székesfehérvári Fterm Kft.
Széph Székesfehérvári Épületfenntartó és Hszolgáltató Zrt.
Szombathelyi Távhszolgáltató Kft.
Tarjánh Szolgáltató-Elosztó Kft.
Tatabánya Erm Kft.
Thermo-Med Kft.
Tisza-Therm Fterm Kft.
Várpalotai Közüzemi Kft.
Zugló-Therm Energiaszolgáltató Kft.
Total peak heat demand of district
heating
MWth 8 598 7 884 6 350 6 657 6 451 6 272 5 776 5 564 5 634 5266 5007
Total heat sales TJ 83 514 73 405 56 477 58 649 56 374 56 171 50 564 50 101 46 200 40 449 37 810
Co-generated electricity production GWh 2 227 2 869 3 386 5 894 6 206 6 478 6 406 5 716 6 280 6 267 7 072
Table 6.1
Table 6.2
annual report 2009 | 69

hungarian energy office
Typical Indices on District Heating in Hungary, 2007
Residential heating
Institutional heating
Residential hot water
Institutional hot water
Industrial heat consumption
Total
Residential heating
Institutional heating
Residential hot water
Institutional hot water
Industrial heat consumption
Total
annual report 2009 | 70
Annual heat consumption
Typical Indices on District Heating in Hungary, 2008
Annual heat consumption
Derived from power
plants supervised
by the Office
Derived from power
plants supervised
by the Office
Total heat consumption
supervised by the Office
(TJ) (TJ) (%)
17 279 11 512 66.6
3 894 2 621 67.3
6 017 3 868 64.3
423 276 65.2
12 836 11 435 89.1
40 449 2 9 711 7 3.5
Total heat consumption
supervised by the Office
(TJ) (TJ) (%)
17 566 11 939 68.0
4 187 2 803 66.9
5 823 3 876 66.6
468 313 66.9
9 766 8 847 90.6
37 810 27 777 73.5
Table 6.3

annual report 2009
7. PRICES AND TARIFFS OF ELECTRICITY AND NATURAL GAS
Residential Electricity Prices from 1st of July 2010 (including 25% VAT)
Residential (average)
(1) (2)
(1)(2)
Tariffs
"A" tariff (general)
Block I (up to 1320 kWh/year)
Block II (above 1320 kWh/year)
"B" tariff (separately measured)
(1)
(1)
(1)
Universal Supplier
EDF DÉMÁSZ ELMŰ ÉMÁSZ E.ON
42.32 44.49 41.67 41.51
45.31 46.22 45.76 45.23
44.68 45.39 45.08 43.90
46.03 47.06 46.74 46.96
28.21 28.95 28.33 29.16
Table 7.1.1
(HUF/kWh)
(3)
2400 kWh/year in case of A1 tariff
46.26 47.12 46.80 46.25
Notes:
(1) The indicated fi gures include the supply price, the system-usage tariffs in proportion of use, 25% VAT on all the above, and all other costs related to the
electricity bill. Furthermore, consumers need to pay a 2340 HUF/year (including VAT) basic distributors fee in case of the „A1” tariff, and a 780 HUF/year
(including VAT) distributors fee in case of the „B” tariff.
(2) Average fi gures calculated according to the capacity data handed in in appendix to the July 2010 price decrease request of the universal suppliers.
(3) The indicated fi gures include the supply price, the system-usage tariffs (including basic distributors fee), 25% VAT on all these tariffs, and all other costs
related to the electricity bill.
Electricity Prices (Current Prices); 1990 - 2009
HUF/kWh
45
40
35
30
25
20
15
10
5
0
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Average end-user price Average non-residential price Average residential price Average residential price including VAT
Figure 7.1
annual report 2009 | 71

hungarian energy office
Residential Price Changes (Including VAT) in the Case of Certain Universal Suppliers
Tariff categories
Tariff categories
Residential (average)
(5)
"A" tariff (general)
Block I (up to 1320 kWh/year)
Block II (above 1320 kWh/year)
"B" tariff (separately measured)
annual report 2009 | 72
(3)
EDF DÉMÁSZ ELMŰ ÉMÁSZ E.ON
Universal
EDF DÉMÁSZ ELMŰ ÉMÁSZ E.ON
(1) July 2010 / January 2010 (2)
July 2010 / January 2009
Residential (average) -4.16% -1.56% -6.01% -4.29% 6.64% 8.52% 8.13% 7.48%
(3)
"A" tariff (general) -4.59% -1.55% -5.90% -4.48% 6.08% 8.11% 3.10% 6.04%
Block I (up to 1320 kWh/year) -4.22% -1.55% -5.85% -4.38% 6.41% 8.11% 7.37% 4.57%
Block II (above 1320 kWh/year) -4.99% -1.57% -5.98% -4.60% 5.73% 8.11% 7.37% 7.88%
"B" tariff (separately measured) -0.02% -1.74% -6.63% -3.32% 11.76% 14.69% 12.21% 15.53%
2400 kWh/year in case of A1 tariff -4.48% -1.52% -5.79% -4.39% 6.15% 8.12% 7.39% 6.13%
Residential Electricity Prices and Price Changes Including VAT 1 from 1 January 2006 until 30 June 2009
from
January (3)
2006
Prices (HUF/kWh) Price change
from from from from
August (3) February(3)
January (4) January(4)
2006 2007 2008 2009
January
2006
August
2006
February
2007
January
2008
January
2009
28.32 32.40 34.05 39.03 (6)
(6)
40.15 -4.0% 14.4% 5.1%
(7)
9.8% 2.9%
32.77 36.85 38.53 42.27 43.54 -4.0% 12.4% 4.6% 9.7% 3.0%
32.16 36.24 37.92 41.57 42.85 -4.0% 12.7% 4.6% 9.6% 3.1%
33.60 37.68 39.36 43.14 44.40 -4.0% 12.1% 4.5% 9.6% 2.9%
17.16 21.24 22.92 25.09 25.60 -4.0% 23.8% 7.9% 9.5% 2.0%
Table 7.1.2
Notes
(1) The indicated fi gures show the effects of the change in supply tariffs in July 2010 (the system-usage tariffs did not change).
(2) Indicated fi gures show the common effect of
- universal supply tariff changes („product prices”) July 2009 (only EDF DÉMÁSZ and E.ON), August 2009 (only ELMŰ and ÉMÁSZ), 2009. November
2009 (all four suppliers), January 2010 (only EDF DÉMÁSZ and E.ON) and July 2010 (all four suppliers),
- the January 2010 change in system-usage tariffs (excluding distributor basic fee), and
- the July 2009 change in VAT (from 20 % to 25 %). The change in distributor basic fee (1/7/2010 / 1/1/2009) , which includes the effect of the July
2009 5% raise of VAT is 8,3 %.
(3) Average fi gures calculated according to the capacity data handed in in appendix to the July 2010 price decrease request of the universal suppliers.
Table 7.2
Notes
(1) From 1/1/2006 until 30/6/2009 VAT was 20% (from July 2009 it is 25 %)
(2) Since the 1st of July 2009 universal supply tariffs („product prices”) and hence end-user prices (total prices) are no longer uniform, therefore only limited-use
national data can be calculated
(3) Calculated with the quantitative weights used for the January 2006 price setting.
(4) Prices relevant for residential customers provided within universal supply introduced on 1/1/2008.
(5) Until 2008 „A” (public utility tariff), from 2008-tól „A1” (universal supply) tariff
(6) Calculated without the consumption of the emloyees and pensioners of the electricity industry supplied with tariff „Residential C” in the public utility supply
(until 31/12/2007).
Uncomparable to the 34.05 HUF/kWh average price relevant from February 2007 which would be 35.28 HUF/kWh if calculated without the consumption in
question.
(7) Compared to the 35.28 HUF/kWh average price which is calculated without the consumption of the emloyees and pensioners of the electricity industry
supplied with tariff „Residential C” in the public utility supply (until 31/12/2007).

Average Electricity Prices for Residential Consumers in the EU- All Taxes Included
(DC: 2500-5000 kWh/year)
€/kWh
0.30
0.25
0.20
0.15
0.10
0.05
0 00
2008. I. 2008. II. 2009. I. 2009. II.
Average Electricity Prices for Non-Residential Consumers in the EU- All Taxes Included
(IE : 20 000 - 70 000 MWh/year)
€/kWh
0.25
0.20
0.15
0.10
0.05
0.00
annual report 2009
Source: Eurostat
2008. I. 2008. II. 2009. I. 2009. II. Source: Eurostat
Figure 7.2
Figure 7.3
annual report 2009 | 73

hungarian energy office
Regulated Electricity System Usage Charges in Hungary as of 1st of January 2010 (Excluding VAT 1 )
I. Charges of Transmission-system Operation and Ancillary Services (HUF/kWh)
A) To be paid to the distributor by the end-users connected to distribution network
1.1 Transmission and system operation charge
1.2 Charge for ancillary services
B) To be paid to the TSO by the end-users connected to transmission
network after cross-border electricity transmission
2.1 Transmission and system operation charge
Export
0 0.25
2.2 Charge for ancillary services 0 0
II. Distribution charges
a.) High-voltage connection
b.)
Connection to medium-voltage
transformer
c.) Medium-voltage connection
d.)
e.)
da) I.
db) II.
dc) III.
Low-voltage connection
ea) I.
eb) II.
ec) III.
a.) High-voltage connection
b.) Medium-voltage connection
c.) Low-voltage connection
annual report 2009 | 74
Distribution
basic charge
HUF/connection
point/year
0.823
0.712
Import 2
Distribution
capacity
charge
Distribution
energy
charge
Distribution
reactive
power
charge
To be paid to the distributor
A) By those taking electricity out from distribution network and in case of export from distribution network
[5. § (4) section a) point aa), ac) subpoints and b) point ba) subpoint]
Connection to low-voltage transformer
3
3
4
4
5
5
B) By those feeding electricity into distribution network and in case of import into distribution network
[5. § (4) section a) point ab) and bb) subpoints]
Public lighting distribution charge [6. § (2) section] 9.42
Distribution
loss charge
Distribution
time schedule
balancing fee
HUF/kW/year HUF/kWh HUF/kVArh HUF/kWh HUF/kWh
204 600 864 0.13 2.05 0.22 -
102 300 2 436 0.71 2.47 0.34 -
102 300 4 884 1.28 2.47 1.16 -
3 408 --- 3.85 3.43 2.18 0.45
1 152 --- 1.19 --- 1.62 0.30
34 104 5 076 1.85 3.43 2.18 -
1 872 --- 9.33 3.43 3.71 0.45
624 --- 2.88 --- 2.76 0.30
34 104 7 512 4.12 3.43 3.71 -
0 0 0 0 0 -
0 0 0 0 0 -
0 0 0 0 0 -
Table 7.3
Notes
1.: The indicated charges are defi ned by KHEM Decree 69/2009 (4. 12) effective from 1/1/2010 (published in Magyar Közlöny No. 175/2009) amending GKM
Decree 119/2007 (29. 12) on Setting General System Usage Charges Applied in the Electricity Supply.
2.: For countries not acting in accordance with Regulation 1228/2003/EC of the European Parliament and of the Council of 26 June 2003, Article 3 according to
the system operators’ contracts (visit www.mavir.hu, the homepage of MAVIR for more information).
3.: With contracted capacity not exceeding 55,2 kW or 3x80 A.
4.: In case of controlled consumption.
5.: With contracted capacity exceeding 55,2 kW or 3x80 A.

General Electricity System Usage Charges (Excluding VAT 1 ) from 2007
3
Connection to the transmission network
4,5
Connection to the
distribution network
High-voltage connection
Connection to medium-voltage
6
transformer
Medium-voltage connection
Connection to low-voltage
8
transformer
10
Low-voltage connection I.
Low-voltage connection II.
(controlled)
Low-voltage connection III.
Average
See notes in table 7.4.2. for explanation.
High-voltage connection
Connection to medium-voltage
6
transformer
Medium-voltage connection
Connection to low-voltage
8
transformer
10
Low-voltage connection I.
Low-voltage connection II.
(controlled)
11
Low-voltage connection III.
Average
11
February
2007 7
January
2008 7
January
2009 12
annual report 2009
January
2010 13
4.43 1.52 1.00 1.54
5.49 2.39 1.97 2.21
6.83 3.78 3.25 3.71
8.24 5.45 5.27 5.69
6.80
7.26
7.68
15.59
13.30
14.60
15.42
8.43 6.42 7.36 7.67
14.42
12.38
13.07
14.10
11.36 8.73 9.05 9.50
Average Changes 2 to the General Electricity System Usage Charges (Excluding VAT) from 2007
3
Connection to the transmission network
4,5
Connection to the
distribution network
February
2007 7
January
2008 7
January
2009 12
January
2010 13
-9.0% -65.6% -34.3% 53.5%
-7.4% -56.5% -17.3% 9.4%
-4.6% -44.6% -7.6% 1.7%
-2.5% -33.9% -0.1% 8.9%
-10.3% 4.7%
2.1% -14.7% 10.0% 4.9%
-2.2% -23.8% 14.6% 5.3%
1.6% -14.2% 8.6% 4.7%
0.1% -23.1% 6.2% 2.9%
Table 7.4.1.
(HUF/kWh)
Notes
1. Until 30th of June 2009 VAT was 20%, since 1st of July 2009 it is 25%
2. The fi gures show the changes compared to the average prices of the previous period
3. Sum of transmission system operation (before 2008 separate transmission and system operation charges) and ancillary services charges
4. Sum of transmission system operation (before 2008 separate transmission and system operation charges), ancillary services and the average value of the
distribution charges
5. Calculated excluding the distribution time schedule balancing fee
6. A category introduced on 1/1/2004
7. Calculated with the quantitative weights considered for the 2005 - 2008 price regulation period
8. A category introduced on 1/1/2008
9. The values shown here represent also the impact of the abolishment of the non-tax levies which formed part of the system operation charge before 2008
10. Before 2008 in case of not more than 3*32 A, in 2008 not more than 3*50 A, and from 2009 not more than 3*80 A tied-up/contracted capacity
11. Before 2008 in case of more than 3*32 A, in 2008 more than 3*50 A, and from 2009 more than 3*80 A tied-up/contracted capacity
12. Calculated with the quantitative weights considered for the 2009 - 2012 price regulation period
13. Quantity used to calculate 2010 prices with weighted averages
Table 7.4.2.
annual report 2009 | 75

Table 7.5
Natural Gas Tariffs Valid in Universal Supply* (Excluding VAT and Energy Tax)
hungarian energy office
from the 1st of July 2009 from the 1st of October 2009 from the 1st of January 2010 from the 1st of April 2010
According to HEO decision, 10th of August 2009 According to HEO decision, 22nd of September 2009 According to HEO decision, 21st of December 2009** According to HEO decision, 25th of March 2010**
basic/output price gas tariff average price basic/output price gas tariff average price basic/output price gas tariff average price basic/output price gas tariff average price
HUF/pc;
HUF/pc;
HUF/pc;
HUF/pc;
HUF/(m 3/h);
HUF/MJ HUF/(m 3/h);
HUF/MJ
HUF/(m 3/h);
HUF/MJ
HUF/(m 3/h);
HUF/MJ
HUF/(MJ/h);
HUF/(MJ/h);
HUF/(MJ/h);
HUF/(MJ/h);
sales category
WEIGHTED AVERAGE***
6 828
3.078 3.200 6 828 2.679 2.814 12 000 2.742 2.981 12 000 3.025 3.287
19 068 2.770 3.301 19 068 2.336 2.908 19 068 2.256 2.839 19 068 2.493 3.031
1 000 2.409 2.955 1 000 2.063 2.600 1 000 1.992 2.529 1 000 2.300 2.837
1 000 2.608 2.904 1 000 2.175 2.450 1 000 2.063 2.359 1 000 2.393 2.690
3
below 20 m /h
3
between 20-100 m /h
3
between 100-500 m /h
annual report 2009 | 76
3
above 500 m /h
SIMPLE AVERAGE****
6 828 3.072 3.195 6 828 2.672 2.808 12 000 2.736 2.994 12 000 3.005 3.272
19 068 2.748 3.295 19 068 2.321 2.908 19 068 2.244 2.801 19 068 2.470 3.047
1 000 2.394 2.950 1 000 2.053 2.598 1 000 1.980 2.525 1 000 2.284 2.830
1 000 2.605 2.899 1 000 2.175 2.451 1 000 2.029 2.325 1 000 2.400 2.696
3
below 20 m /h
3
between 20-100 m /h
3
between 100-500 m /h
3
above 500 m /h
E.ON
6 828 3.066 6 828 2.670 12 000 2.725 12 000 2.966
19 068 2.686 19 068 2.284 19 068 2.207 19 068 2.377
1 000 2.291 1 000 1.960 1 000 1.851 1 000 2.141
1 000 2.629 1 000 2.243 1 000 1.954 1 000 2.429
3
below 20 m /h
3
between 20-100 m /h
3
between 100-500 m /h
3
above 500 m /h
ÉGÁZ-DÉGÁZ
6 828 3.090 6 828 2.668 12 000 2.758 12 000 3.006
19 068 2.716 19 068 2.259 19 068 2.213 19 068 2.423
1 000 2.490 1 000 2.065 1 000 2.044 1 000 2.265
1 000 2.605 1 000 2.212 1 000 1.930 1 000 2.437
3
below 20 m /h
3
between 20-100 m /h
3
between 100-500 m /h
3
above 500 m /h
FŐGÁZ, ÓZD, CSEPEL, ISD POWER
6 828 3.026 6 828 2.642 12 000 2.706 12 000 2.955
19 068 2.818 19 068 2.395 19 068 2.325 19 068 2.540
1 000 2.299 1 000 2.090 1 000 2.006 1 000 2.362
1 000 2.561 1 000 2.220 1 000 2.243 1 000 2.370
3
below 20 m /h
3
between 20-100 m /h
3
between 100-500 m /h
3
above 500 m /h
TIGÁZ
6 828 3.107 6 828 2.707 12 000 2.757 12 000 3.095
19 068 2.773 19 068 2.345 19 068 2.233 19 068 2.539
1 000 2.495 1 000 2.097 1 000 2.019 1 000 2.369
1 000 2.623 1 000 2.023 1 000 1.989 1 000 2.363
3
below 20 m /h
3
between 20-100 m /h
3
between 100-500 m /h
3
above 500 m /h
Notes
* Including (non VAT-based) tariff as defi ned in the Act 40 of 2008 Section 138/A. Tariff value from July 1st to September 30th 2009 0.515 HUF/MJ, since October 1st 2009 0.092 HUF/MJ
** Including (VAT-based) membership tariff on natural gas storage as defi ned in the Act 26 of 2006 Section 8. (Was part of the gas price until the 31st of December 2009)
*** Weighted average: weighted price average of four universal suppliers group
**** Simple average: price average of four universal suppliers group

The Quarterly Change of the Authority Controlled (Maximum) Natural Gas Prices* (excluding VAT and Energy Tax)
Table 7.6
change (%)
April 2010/January 2010
January 2010/October 2009
October 2009 /July 2009
sales category
gas tariff average price
basic and output
price
gas tariff average price
basic and output
price
gas tariff average price
basic and output
price
WEIGHTED AVERAGE***
0.0%
-13.0% -12.1% 75.7% 2.4% 5.9% 0.0% 10.3% 10.3%
0.0% -15.7% -11.9% 0.0% -3.4% -2.4% 0.0% 10.5% 6.8%
0.0% -14.4% -12.0% 0.0% -3.4% -2.7% 0.0% 15.5% 12.2%
0.0% -16.6% -15.6% 0.0% -5.1% -3.7% 0.0% 16.0% 14.0%
3
below 20 m /h
3
between 20-100 m /h
3
between 100-500 m /h
3
above 500 m /h
SIMPLE AVERAGE****
0.0% -13.0% -12.1% 75.7% 2.4% 6.6% 0.0% 9.8% 9.3%
0.0% -15.6% -11.7% 0.0% -3.3% -3.7% 0.0% 10.1% 8.8%
0.0% -14.2% -11.9% 0.0% -3.6% -2.8% 0.0% 15.4% 12.1%
0.0% -16.5% -15.4% 0.0% -6.7% -5.1% 0.0% 18.3% 16.0%
3
below 20 m /h
3
between 20-100 m /h
3
between 100-500 m /h
3
above 500 m /h
E.ON
0.0% -12.9% 75.7% 2.1% 0.0% 8.8%
0.0% -15.0% 0.0% -3.4% 0.0% 7.7%
0.0% -14.4% 0.0% -5.6% 0.0% 15.7%
0.0% -14.7% 0.0% -12.9% 0.0% 24.3%
3
below 20 m /h
3
between 20-100 m /h
3
between 100-500 m /h
3
above 500 m /h
ÉGÁZ-DÉGÁZ
0.0% -13.7% 75.7% 3.4% 0.0% 9.0%
0.0% -16.8% 0.0% -2.0% 0.0% 9.5%
0.0% -17.1% 0.0% -1.0% 0.0% 10.8%
0.0% -15.1% 0.0% -12.7% 0.0% 26.3%
3
below 20 m /h
3
between 20-100 m /h
3
between 100-500 m /h
3
above 500 m /h
FŐGÁZ, ÓZD, CSEPEL, ISD POWER
0.0% -12.7% 75.7% 2.4% 0.0% 9.2%
0.0% -15.0% 0.0% -2.9% 0.0% 9.2%
0.0% -9.1% 0.0% -4.0% 0.0% 17.7%
0.0% -13.3% 0.0% 1.0% 0.0% 5.7%
3
below 20 m /h
3
between 20-100 m /h
3
between 100-500 m /h
3
above 500 m /h
annual report 2009
TIGÁZ
0.0% -12.9% 75.7% 1.8% 0.0% 12.3%
0.0% -15.4% 0.0% -4.8% 0.0% 13.7%
3
below 20 m /h
3
between 20-100 m /h
0.0% -16.0% 0.0% -3.7% 0.0% 17.3%
0.0% -22.9% 0.0% -1.7% 0.0% 18.8%
3
between 100-500 m /h
3
above 500 m /h
Notes
* Including (non VAT-based) tariff as defi ned in the Act 40 of 2008 Section 138/A. Tariff value from July 1st to September 30th 2009 0.515 HUF/MJ, since October 1st 2009 0.092 HUF/MJ
** Including (VAT-based) membership tariff on natural gas storage as defi ned in the Act 26 of 2006 Section 8. (Was part of the gas price until the 31st of December 2009)
*** Weighted average: weighted price average of four universal suppliers group
**** Simple average: price average of four universal suppliers group
annual report 2009 | 77

hungarian energy office
Natural Gas Prices (Current Prices); 1990 - 2009
100
100
HUF/m 3
80
60
40
20
0
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
€/GJ
27
24
21
18
15
12
9
6
3
0
Average end-user price Average non-residential price Average residential price Average residential price including VAT
annual report 2009 | 78
2008. I. 2008. II. 2009. I. 2009. II.
Source: Eurostat
Figure 7.4
Average Natural Gas Prices for Residential Consumers in the EU- All Taxes Included
(D2: 20-200 GJ/year) Figure 7.5

annual report 2009
Authority Controlled (Highest) Natural Gas System Usage Prices (Excluding VAT 1 ) 2 in Hungary as of the 1st of July
2009
1. a) Transmission tariff system
Table 7.7
a) Transmission charge
exit point 2 221
Kiskundorozsma exit point -
Csanádpalota exit point -
Austrian/Hungarian border
(Baumgarten) entry point
12 144
Ukrainian/Hungarian border
(Beregovo) entry point
12 144
internal production entry point 10 930
storage entry point 7 287
1. b) Odouring Charge
odouring charge (HUF/l)
4 039
2. Distribution Charges
Charged system users
3
Customers with contracted capacity between 101-500 m /h
3
Customers with contracted capacity above 500 m /h
Distribution
lump charge
HUF/m3
Customers without gas meter 11.85
Transmission capacity charges Transmission traffic charges
(HUF/(m 3/h)/year) (HUF/m 3)
Distribution
standing
charge
HUF/year
3
Customers with gas meters below 20 m /h 6 828
0,833
Distribution
standing
charge
HUF/m 3/h/year
3
Customers with gas meters between 20-100 m /h 9 900
Distribution
capacity
charge
HUF/m 3/h/year
Distribution
gas charge
HUF/m3
5.71
12 912 0.79
11 892
7.40
0.83
annual report 2009 | 79

hungarian energy office
3. Storage tariff system
a)
Withdrawal charge
HUF/m3 0.119
b) Determination of mobile storage charge and peak storage charge is as follows:
(i) TM = 5.32 x cm 0,48
[HUF/m
0,48
3 ]
[HUF/m 3
(ii) TCS = 230.26 x cm /day/year]
(iii) BT = [(bk / m) / (1/150)/3 + 2/3] * 0.78
where
3
TM: mobile storage charge (HUF/m )
3
TCS: peak storage charge (HUF/m /day/year)
3
BT: injection charge (HUF/m )
cm = 100 * cs / m
3
cm: 100 million m based peak / mobile capacity contract of the customer entitled to access
3
cs: peak storage contract (m /day) of the customer entitled to access
Notes
1. As of the 1st of July 2009 25%
2. The charges are included in the KHEM decree 31/2009 (25. 6)
Average Level of Natural Gas System Usage Charges (Excluding VAT 1 ) as of
January 1st 2009
Average natural gas system
usage charges
Notes
1. As of the 1st of July 2009 25%
2. Calculated average charges taking into account the consumed quantity
3. Calculated average taking into account storage amounts
annual report 2009 | 80
m: mobile storage contract (m 3 ) of the customer entitled to access
bk: the injection capacity booking of the system user (m /day)
2
3
Transmission Storage Distribution
4.94 9.25 9.40
3
System usage
altogether
23.59
Table 7.8
(HUF/m3 )

APPENDIX
LAW RELEVANT TO THE ACTIVITIES OF THE HUNGARIAN ENERGY OFFICE
Act XLVII of 2008
Act XLII of 2008
Act XL of 2008
Act LXXXI of 2008
Act LXX of 2008
Act LXVIII of 2008
Act LXVII of 2008
Act LXV of 2008
Act CVIII of 2008
Act XXXII of 2007
Act LXXXVI of 2007
Act CXXXIII of 2007
Act CXXI of 2007
Act CXVI of 2007
Act XXVI of 2006
Act XVIII of 2005
Act XV of 2005
Act LXXXVIII of 2003
Act CXXVII of 2003
Act CXXIX of 2003
Act CLV of 2007
Act CXVII of 1995
Act XLVIII of 1993
Act III of 1993
Act LXXXVII of 1990
Govt. Decree 206/2009 (22.09)
Govt. Decree 182/2009 (10.09)
Govt. Decree 163/2009 (6.08)
Govt. Decree 139/2009 (30.06)
Govt. Decree 76/2009 (8.04)
Govt. Decree 64/2009 (31.03)
Govt. Decree 19/2009 (30.01)
annual report 2009
on the Prohibition of Dishonourable Trading Practice towards the Consumers
on the Amendment of Certain Acts Concerning to the Act CLV of 2007 on
Consumer Protection
on Natural Gas Supply
on the Amendment of Certain Acts Concerning Taxes and Contributions
on Several Questions Related to Electricity
on the VAT- and Excise Duty Exemption of the Products Imported in the
Personal Luggage of Passengers
on the Escalation of Competitiveness of the District Heat Supply
on the Amendment of Act CXVI of 2007 Concerning the Amendment of Certain
Acts Affecting the Companies of Extraordinary Signifi cance from the Point of
View of Safety of Public Supply as well as Certain Related Acts
on the Amendment of Act CXXIX of 2003 on Public Procurement
Amending Certain Acts Concerning Energetic Affairs
on Electricity
on the Amendment of Act XLVIII of 1993 on Mining
on the Modifi cation of Certain Acts Concerning Social Affairs
on the Amendment of Certain Acts Affecting the Companies of Extraordinary
Signifi cance from the Point of View of Safety of Public Supply
on Safety Stockpiling of Natural Gas
on District Heat Supply
on the Trade of the Greenhouse Gas Emission Allowances
on Energy Tax
on Excise Duty and the Special Rules of Distribution of Excisable Products
on Public Procurement
on Consumer Protection
on Personal Income Tax
on Mining
on Social Administration and Social Care
on the Defi nition of Prices
on the Amendment of Govt. Decree 389/2007 (23. 12) on the Feed-In and
Feed-In Price of Electricity Produced from Energy Gained from Waste or from
Renewable Energy Sources and of Co-generated Electricity
on the Amendment and Repeal of Certain Government Decrees in Connection
with the Coming Into Effect of Act CXI of 2008 Amending Act CXL of 2004
on the General Rules Public Administration Procedure and Service, and with
the Transposition of Directive 2006/123/EC
on the Amendment of Certain Government Decrees for the Purpose of Reducing
the Administrative Burden
on the Amendment of Govt. Decree 19/2009 (30. 01) Concerning the
Implementation of the Provisions of Act XL of 2008 on Natural Gas Supply
on the Procedures of Spatial Physical Planning
on the Amendment of Certain Government Decrees in Connection with the
Effi ciency of Final Energy Use and with the Energetic Services
on the Implementation of the Provisions of Act XL of 2008 on Natural Gas
Supply
annual report 2009 | 81

hungarian energy office
Govt. Decree 277/2008 (24.11)
Govt. Decree 350/2008 (31.12)
Govt. Decree 287/2008 (28.09)
Govt. Decree 389/2007 (23.12)
Govt. Decree 225/2007 (31.08)
Govt. Decree 289/2007 (31.10)
Govt. Decree 382/2007 (23.12)
Govt. Decree 285/2007 (29.10)
Govt. Decree 278/2007 (20.10)
Govt. Decree 273/2007 (19.10)
Govt. Decree 264/2006 (20.12)
Govt. Decree 260/2006 (20.12)
Govt. Decree 157/2005 (15.08)
GKM Decree 119/2007 (29.12)
GKM Decree 117/2007 (29.12)
GKM Decree 116/2007 (29.12)
GKM Decree 110/2007 (23.12)
GKM Decree 109/2007 (23.12)
GKM Decree 91/2007 (20.11)
KHEM Decree 48/2009 (30.09)
KHEM Decree 43/2009 (31.08)
KHEM Decree 33/2009 (30.06)
KHEM Decree 31/2009 (25.06)
KHEM Decree 29/2009 (25.06)
KHEM Decree 28/2009 (25.06)
annual report 2009 | 82
on the Central Record of Documents related to Building Affairs, Urban
Development and Spatial Physical Planning
on the Amendment of Govt. Decree 273/2007 (19. 10) Implementing Certain
Provisions of Act LXXXVI of 2007 on Electricity.
On the Amendment of Govt. Decree 389/2007 (23. 12) on the Feed-In and
Feed-In Price of Electricity Produced from Energy Gained from Waste or from
Renewable Energy Sources and of Co-generated Electricity
on Feed-in Obligation and Price of the Electricity Generated from Renewable
Sources or Waste, or Co-generated Electricity
on the Hungarian Authority for Consumer Protection
on the Social Support for Household Mains Gas Consumption and District Heat
Consumption
on the Licensing Procedures of the Architectural Authority of the Electricity
Industry
on the Needful Arrangements in case of Signifi cant Disturbances of the
Electricity System and Crisis of the Electricity Supply
on the Detailed Rules of the Rate and the Stating of the Subsidy of Restructuring
the Coal Industry
on the Execution of Act LXXXVI of 2007 on Electricity
on the Amendment of Certain Government Decrees Concerning Transport in
Connection with the Establishment of the National Transport Authority
on the Hungarian Trade Licensing Offi ce
on the Execution of Act XVIII of 2005 on District Heating
on the Charges for Electricity System Use
on the Financial and Technical Conditions of the Joining to the Public Electricity
Network
on the Allowance on the Purchase of Electricity That Might Be Resorted in
Connection to the Effective or Past Employment in the Electricity Industry
on the Calculation Method of the Co-generated Electricity and the Determination
of the Amount of the Useful Heat Generated with Great Effi ciency
on the Distribution of Electricity Subject to Feed-in Obligation by System Operator,
and the Method of the Pricing Used During the Distribution
on the Rate of the Administrative Charges of the Hungarian Energy Offi ce, and
the Rules of Paying of the Administrative Charges and the Supervision Fee
on the Amendment of Certain Ministerial Decrees in Connection with the Entering
into Force of Act CXI of 2008 amending Act CXL of 2004 on the General
Rules of Public Administrative Procedures and Services
on the Amendment of KHEM Decree 44/2008 (31. 12) on the Pricing of on
the Universal Electricity-Market Service, and on the Product Packages to Be
Provided in the Framework of Universal Service
on the Conditions of Applications for the Establishment of Wind Power
Capacities, the Minimum Content Requirement of Applications, and the Rules
of Application Procedure
on the Setting of Natural Gas System Use Charges
on the Price Setting in Connection with the Universal Service in the Natural
Gas Market
on the Determination of Prices Mechanisms Relevant to the Universal Natural
Gas Service

KHEM Decree 27/2009 (25.06)
KHEM Decree 24/2009 (9.06)
KHEM Decree 44/2008 (31.12)
KHEM Decree 36/2009 (22.07)
KHEM Decree 17/2008 (1.08)
KHEM Decree 6/2008 (18.06)
MeHVM Decree 23/2007 (29.08)
annual report 2009
on the Detailed Rules of Compensation of the Defi cit Occurring at the Public
Utility Wholesale Licensee in Accordance with Act XLII of 2003 on Natural
Gas Supply
on the Amendment of GKM Decree 116/2007 (29. 12) Concerning the Electricity
Purchase Benefi ts Provided in Connection with Actual or Past Employment
relationships in the Electricity sector
on the Pricing of Universal Service in the Electricity Market and the Product
Packages to Be Provided in the Framework of Universal Service
on the Aspects to Be Considered During the Determination of Household District
Heat Charges and the Heat Energy Charges Applied in The Contracts Between
District Heat Producers and District Heat Suppliers, and on the Obligatory Data
Submittance for the Procedure Carried Out by the Hungarian Energy Offi ce
on the Types and Charges of Services that Can Be Provided by the Electricity
Distribution Grid Licensee and the Universal Service Provider on the Basis of
Demand from the Customer
on the Different Data Supplies Related to the Control, Operation and Use of the
Electricity System
on the Detailed Rules and Support Titles of the Use of Financial Resources
Assigned to the Priorities of the Environment and Energy Operational
Programme
annual report 2009 | 83

hungarian energy office
DIRECTIVES AND REGULATIONS OF THE EU
Directive 2009/72/EC
Directive 2009/73/EC
Directive 2009/28/EC
Directive 2009/29/EC
Directive 2009/31/EC
Directive 2008/92/EC
Directive 2006/32/EC
Directive 2005/89/EC
Directive 2004/8/EC
Directive 2003/55/EC
Directive 2003/54/EC
Directive 2001/77/EC
Regulation (EC) No 715/2009
Regulation (EC) No 714/2009
Regulation (EC) No 713/2009
Regulation 2386/96/EC
Regulation 736/96/EC
Commission Decision 2008/952/EC
Commission Decision 2007/394/EC
Commission Decision 2006/770/EC
annual report 2009 | 84
of the European Parliament and of the Council of 13 July 2009 concerning
common rules for the internal market in electricity and repealing Directive
2003/54/EC
of the European Parliament and of the Council of 13 July 2009 concerning
common rules for the internal market in natural gas and repealing Directive
2003/55/EC
of the European Parliament and of the Council of 23 April 2009 on the promotion
of the use of energy from renewable sources and amending and subsequently
repealing Directives 2001/77/EC and 2003/30/EC
of the European Parliament and of the Council of 23 April 2009 Amending
Directive 2003/87/EC so as to improve and extend the greenhouse gas emission
allowance trading scheme of the Community
of the European Parliament and of the Council of 23 April 2009 on the geological
storage of carbon dioxide and amending Council Directive 85/337/
EEC, European Parliament and Council Directives 2000/60/EC, 2001/80/EC,
2004/35/EC, 2006/12/EC, 2008/1/EC and Regulation (EC) No 1013/2006
of the European Parliament and of the Council of 22 October 2008 concerning a
Community procedure to improve the transparency of gas and electricity prices
charged to industrial end-users
of the European Parliament and of the Council of 5 April 2006 on energy enduse
effi ciency and energy services and repealing Council Directive 93/76/EEC
of the European Parliament and of the Council of 18 January 2006 concerning
measures to safeguard security of electricity supply and infrastructure
investment
of the European Parliament and Council of 11 February 2004 on the promotion
of cogeneration based on a useful heat demand in the internal energy market,
and on the amendment of Directive 92/42/EEC
of the European Parliament and Council of 26 June 2003 concerning common
rules for the internal market in natural gas and repealing Directive 98/30/EC
of the European Parliament and Council of 26 June 2003 concerning common
rules for the internal market in electricity and repealing Directive 96/92/EC
of the European Parliament and Council of 27 September 2001 on the promotion
of electricity produced from renewable energy sources in the internal electricity
market
of the European Parliament and of the Council of 13 July 2009 on conditions
for access to the natural gas transmission networks and repealing Regulation
(EC) No 1775/2005
of the European Parliament and of the Council of 13 July 2009 on conditions
for access to the network for cross-border exchanges in electricity and repealing
Regulation (EC) No 1228/2003
of the European Parliament and of the Council of 13 July 2009 establishing an
Agency for the Cooperation of Energy Regulators
of the Commission of 16 December 1996 applying Regulation 736/96/EC of the
Council of 22 April 1996 on notifying the Commission of investment projects of
interest of the Community in the petroleum, natural gas and electricity sectors
of the Council of 22 April 1996 on notifying the Commission of investment
projects of interest of the Community in the petroleum, natural gas and
electricity sectors
of 19 November 2008 establishing detailed guidelines for the implementation
and application of Annex II to Directive 2004/8/EC of the European Parliament
and of the Council
of 7 June 2007 amending Council Directive 90/377/EEC with regard to the
methodology to be applied for the collection of gas and electricity prices
charged to industrial end-users
of 9 November 2006 amending the Annex to Regulation (EC) No 1228/2003 on
conditions for access to the network for cross-border exchanges in electricity