The political transition unfolding in Hungary could significantly reshape the future of the strategically sensitive Paks 2 nuclear project, with direct implications for Serbia and its long-discussed ambition to secure participation in the expansion of the nuclear complex. The issue goes far beyond bilateral energy cooperation. It now touches questions of geopolitical alignment, financing transparency, EU energy policy and the long-term structure of electricity markets across Central and South-East Europe.
The incoming Hungarian political leadership has already signaled that it intends to review the financing structure, implementation conditions and overall economics of the €12.5 billion Paks 2 project, which has for years represented one of the closest strategic partnerships between Budapest and Moscow inside the European Union.
That shift matters directly for Serbia because Belgrade has repeatedly expressed interest in obtaining access to future nuclear electricity production from Paks 2. Serbian officials have in previous years openly discussed possible ownership participation, long-term supply arrangements or strategic cooperation mechanisms linked to the plant’s future output. The original political logic behind such cooperation was relatively straightforward. Serbia faces growing structural electricity deficits during winter demand peaks, while its decarbonization obligations under European climate frameworks increasingly pressure the long-term viability of coal generation.
For Budapest under former Prime Minister Viktor Orbán, the project also carried broader geopolitical significance. Paks 2 was not simply an energy investment. It symbolized Hungary’s willingness to maintain deep strategic and financial ties with Russia despite broader tensions between Moscow and Brussels. The project was awarded without international tender to Rosatom back in 2014 and financed largely through a Russian state loan structure.
Now the political environment appears to be changing rapidly.
The new Hungarian leadership has emphasized the need for a “transparent nuclear strategy” and signaled a willingness to reassess project costs, financing terms and implementation conditions. That introduces a new layer of uncertainty for Serbia because any future Serbian participation would now have to be negotiated under a potentially very different political and regulatory framework.
This matters particularly because Serbia’s earlier expectations regarding Paks 2 were closely tied to the exceptionally strong political alignment between Belgrade and Orbán’s government. Relations between the two countries intensified significantly after 2022, especially around energy cooperation, regional infrastructure and joint positioning regarding Russian energy imports.
Under a more pro-EU and institutionally reform-oriented Hungarian government, the strategic calculus may change. A revised Budapest administration could prioritize closer alignment with EU energy governance, stricter procurement transparency and reduced geopolitical dependence on Russian strategic infrastructure. That does not necessarily mean Paks 2 will be abandoned. In fact, the project has already moved into active construction phases after the first concrete pour earlier in 2026. However, the commercial and ownership structures surrounding the plant could become subject to much stricter scrutiny.
For Serbia, that creates several possible scenarios.
The most favorable outcome for Belgrade would involve maintaining access to future nuclear-generated electricity through long-term offtake agreements rather than direct equity participation. Such an arrangement would allow Serbia to improve long-term baseload stability without becoming politically entangled in ownership debates surrounding a Russian-financed nuclear project inside the EU.
Direct ownership participation appears more complicated. Analysts have long warned that Serbia could face difficult trade-offs if it attempted to buy into Paks 2. Earlier regional analyses suggested that participation could either require substantial financial commitments or potentially involve strategic concessions related to Serbian energy assets. In a political climate increasingly focused on transparency and EU regulatory compatibility, those discussions could become even more sensitive.
There is also the broader issue of European energy market integration.
As Serbia moves gradually closer toward EU electricity market coupling and decarbonization obligations, nuclear power becomes strategically more attractive. Hydropower expansion remains limited by environmental and permitting constraints. Coal faces rising carbon exposure under the EU’s Carbon Border Adjustment Mechanism and broader ETS-related pressures. Wind and solar capacity are expanding quickly across the Western Balkans, but system balancing and winter baseload stability remain unresolved structural problems.
In that context, access to nuclear-generated electricity from Paks 2 could theoretically provide Serbia with long-duration low-carbon baseload supply during the 2030s. That would improve security of supply while potentially reducing future carbon exposure linked to fossil-based generation.
But the political transformation in Hungary may fundamentally alter the conditions under which such cooperation could happen.
The incoming Hungarian leadership appears eager to rebuild confidence with Brussels, strengthen institutional transparency and reduce perceptions of politically opaque strategic deals. That means future negotiations involving external partners such as Serbia could become more commercially structured, more tightly regulated and more closely aligned with EU state-aid and competition frameworks.
At the same time, the economics of Paks 2 itself remain under increasing scrutiny. Cost escalation, delays and financing exposure have all become politically sensitive issues inside Hungary. Critics within the new political camp have questioned whether the project’s costs remain justified under current market conditions. If the project undergoes redesigns, refinancing or renegotiation, Serbia’s own role could become secondary to domestic Hungarian political priorities.
The timing is particularly important because Serbia itself is now entering a more serious phase of debate around nuclear energy. Serbian Energy Minister Dubravka Đedović Handanović recently confirmed that feasibility studies and preparatory analyses aligned with recommendations from the International Atomic Energy Agency are underway, with strategic decisions expected in coming years.
That suggests Belgrade increasingly views nuclear energy not merely as a regional partnership opportunity, but as a long-term pillar of national energy strategy.
For Serbia, therefore, the political changes in Hungary do not necessarily close the door to cooperation around Paks 2. But they likely transform the nature of that cooperation. The era of politically driven strategic understandings may gradually give way to a more formalized framework shaped by EU energy governance, financial transparency requirements and commercial market logic.
In practical terms, Serbia may ultimately find that securing long-term electricity purchase agreements, transmission cooperation and regional balancing mechanisms becomes more realistic than pursuing direct ownership stakes in the nuclear plant itself.
The broader strategic reality remains unchanged: across Central and South-East Europe, nuclear energy is returning to the center of long-term industrial and energy planning. The question is no longer whether countries in the region will seek nuclear-linked electricity access, but under which political, financial and regulatory conditions those partnerships will be allowed to develop.
