German-Australian start-up Vulcan Energy Resources has been awarded €104 million in public funding to advance its clean lithium production project in Germany, the company announced on Tuesday. The funding comes from the federal government and the states of Rhineland-Palatinate and Hesse, and is part of Berlin’s broader strategy to boost electric vehicle (EV) manufacturing and reduce dependency on foreign raw material imports.
The grants will support Vulcan’s €690 million investment in a geothermal-powered lithium extraction and refining facility. The project includes a plant in Landau, where lithium chloride will be extracted from geothermal brines, and a conversion plant near Frankfurt to produce lithium hydroxide — a vital input for EV battery production.
The company aims to commission its first large-scale industrial plant by the end of 2026, with a projected annual output of 24,000 tonnes of lithium hydroxide. This volume would be sufficient to power approximately 500,000 EVs per year, according to Vulcan.
Germany currently relies heavily on lithium imports from countries such as Australia, Argentina, Chile, and China. However, a recent study by the Federal Institute for Geosciences and Natural Resources and the Fraunhofer IEG suggests the country has enough lithium reserves to meet domestic demand for decades.
Germany’s lithium demand is expected to hit 170,000 tonnes annually by 2030, driven by a sharp rise in battery production needs. Economy Ministry State Secretary Stefan Rouenhoff emphasized the importance of the project, stating: “In times of increasing geopolitical challenges, it is necessary to intensify efforts to open up alternative sources of raw materials for our domestic economy.”
The €104 million in grants will begin disbursement on October 1, spread over a 36-month period. The federal states of Rhineland-Palatinate and Hesse will each co-finance approximately 30% of the total support package.
