The European Union Court of Justice (CJEU) may overturn a previous ruling that upheld the European Commission’s approval of Hungary’s state aid for the expansion of the Paks nuclear power plant (NPP). In separate news, Hungary raised the issue of eliminating sanctions against Paks 2 during talks in Washington earlier this.

CJEU’s advocate general Laila Medina advised the EU’s top court that it should rule in favour of Austria in its appeal against the approval of state aid for the project. CJEU judges frequently follow the recommendations of advocate generals when issuing final rulings, which is expected in the coming months.

Austria has long opposed the Paks expansion and challenged the Commission’s approval of the project in 2017, arguing that the direct award of the construction contract to Russia’s Nizhny Novgorod Engineering Company without a public tender violated EU procurement rules.

Austria took its case to the EU's highest court in 2022 after the bloc's second-highest court rejected its challenge.

Vienna initially sued the European Commission in 2018 over its approval of Hungary's plan to construct two new reactors at the Paks nuclear plant with Russian assistance. The approval was granted after Hungarian authorities committed to implementing measures to ensure fair competition.

In reaction to the news, Foreign Minister Peter Szijjarto accused Brussels of obstructing Hungary’s energy cooperation with Russia, without naming Austria’s involvement in the case. “Construction of the new nuclear power plant is critical to Hungary's energy security, so the project will go ahead despite the constant difficulties and obstacles,” he added.

In related news, Szijjártó on Thursday met with IAEA Director General Rafael Grossi in his office. According to his ministry statement, Hungary is in consultation with the nuclear agency on its plans to extend the operational life of the four blocks by 20 years.

Szijjarto has lobbied to seek extensions for the Paks 2 project from the sanctions approved by the former US administration during his recent trip to Washington.

The minister noted the outgoing Biden administration had adopted several sanctions that are hindering the progress of the project. "That is why I negotiated in Washington last week that the Paks 2 project should be exempted in the interests of the future security of Hungarian energy supply, as the work is already underway and has passed the point of no return," he said.  

Soil consolidation for Paks 2 is complete, with 43,000 piles placed, marking 57% of preparatory work finished and bringing the project closer to its first concrete pour, he added.

He also stated that Hungary would continue blocking any EU attempts to impose sanctions on the nuclear sector.

Brussels is constantly trying to block our energy cooperation with Russia, he wrote on Facebook, criticising ideological opposition to nuclear energy in Europe, calling it detrimental to the continent’s competitiveness and energy security. Hungary prioritises pragmatic energy policies and remains committed to the European nuclear alliance led by France, he added.

Hungary commissioned Rosatom to build two new VVER-1200 reactors at the Paks based on a 2014 intergovernmental agreement, increasing the plant’s capacity from 2,000 MW to 4,400 MW. The four existing blocks generate half of Hungary’s electricity and cover one-third of national consumption.

Moscow has reaffirmed its commitment to financing the €12.5bn project, with 80% of the funding originally set to come from a Russian loan. The project has suffered years of delay as Rosatom failed to meet EU safety standards. The new blocks could go operational in the early 2030s.