The Hungarian geothermal energy market is expected to witness a CAGR of more than 10%, during the forecast period. The primary driver for the market includes government initiatives, to reduce the dependency on energy imports from foreign nations. However, factors, like high electricity generation cost from renewable sources, including geothermal energy in Southeast European countries, are expected to hinder the market growth during the forecast period.

With the significant presence of district heating facilities in 23 towns of Hungary as of 2018, direct heat utilization is expected to dominate the market during the forecast period.

Hungary lies in the Pannonian basin, an area nearly surrounded by the Carpathian Mountains. In Europe, the Pannonian basin stands out as a positive geothermal anomaly, with heat-flow density ranging from 50 to 130 mW/m2, a mean value of 90-100 mW/m2, and a geothermal gradient of about 45 ?C/km.

Moreover, the country has two geothermal reservoirs: a basement reservoir and a basin-fill reservoir. The basement reservoir is in use for direct heat purposes, and the basin-fill reservoir is expected to hold a temperature of 100-120?C, which is expected to have preferable conditions for the development of combined heat and power (CHP) plant installation. Thus, the potential to install CHP plants is expected to create an opportunity for the power generation application to grow, in the future.

With regulatory changes and ongoing and upcoming project, geotherma- based power production is expected to drive the market growth, during the forecast period.

Key Market Trends

Direct Heat Utilization is Likely to Dominate the Market

  • Direct heat utilization includes district heating facilities, which are used to supply heat generated through the geothermal facilities present in the country and represent the major part of the market studied.
  • With 23 direct heating facilities in 2018, it had a total capacity of around 223.36 MWth (Megawatt Thermal) and 635.66 GWhth/year production.
  • Hungary’s largest geothermal district heating project in Miskolc was commissioned, in 2013. This site has two production and three reinjection wells, producing thermal water from karstified-fractured Triassic basement carbonates at a depth of 1500-2300 meters, with a total installed capacity of 55 MWth.
  • Apart from a district heating facility in Miskolc, Hungary has few other similar facilities in Gyor, supplying heat for an industrial user (Audi Hungary). The facility had a capacity of around 52 MWth, along with three production wells with 101-102?C outflow temperature.
  • Upcoming projects, such as district heating in Szeged to provide geothermal energy to 163,000 inhabitants, are expected to boost the geothermal energy market in the country. In 2018, the project was operating with two triplets, and it is expected to expand to nine triplets during the upcoming years.
  • Thus, the existing district heating network and the upcoming and planned networks in Hungary are expected to boost the market studied, during the forecast period.



Geothermal-based Power Production to Drive the Market

  • In 2019, Hungary had only one geothermal-based power generation facility in Tura, with a capacity of around 3 MWe (Megawatt electricity) and 7MWth (Megawatt thermal).
  • Under the concessional system (obligatory for the exploration and exploitation of geothermal energy at a depth below 2,500 m, the typical depth range for power production, and CHP projects), a preliminary complex vulnerability and impact assessment (CVIA) have been prepared for over 20 potential geothermal areas.
  • As of 2018, three geothermal concessional contracts have been signed for 35 years. The areas are expected to have the deep hydrothermal potential for CHP applications.
  • Moreover, the government of the country is highly focused on the power generation facility through its geothermal energy, and it is expected to reduce its dependency on natural gas, for heat and electricity generation.
  • The country is estimated to increase its power generation capacity to around 12 MWe by 2025, with electricity production of around 36,000 GWhe/year. Furthermore, the rise in capacity is estimated to increase the country’s geothermal share in total electricity production of the country.



Competitive Landscape

The Hungarian geothermal energy market is consolidated. The key players in the market include Mannvit, PannErgy PLC, KS Orka Renewables Pte Ltd, and Climeon AB.

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