The Vulcan Energy Resources Ltd (ASX: VUL) share price is pushing higher again on Friday.
In morning trade, the lithium developer’s shares are up 5.5% to $11.68.
This means the Vulcan Energy share price is now up 19% over the last two trading sessions.
Why is the Vulcan Energy share price rising today?
The catalyst for the rise in the Vulcan Energy share price today was the release of its sixth announcement in the space of a month.
On this occasion, the short seller target has announced the acquisition of an operational geothermal renewable energy power plant in the Upper Rhine Valley at Insheim, Germany.
According to the release, Vulcan is paying approximately 31.5 million euros for the plant, which will be funded from a portion of the proceeds from its recent $200 million capital raise.
Management notes that the acquisition of the Insheim Plant establishes Vulcan as an operational renewable energy business. It currently has the technical ability to produce a maximum of 4.8MW renewable power, equivalent to approximately 8,000 households, with an additional ability to produce heating. Though, it currently produces 2.9 MW of electricity on average.
Positively, the Insheim Plant is expected to be a source of revenue for Vulcan. It reported sales of 5.8 million euros and EBITDA of 2.9 million euros for the financial year ending 31 December 2020. The plant presently capitalises on the Feed-in Tariff for geothermal power.
Vulcan will formally take over the plant from 1 January 2022 and will retain all existing local employees as part of the transition. The company also plans to invest in the expansion and modernisation of the power plant.
Vulcan’s Managing Director, Dr. Francis Wedin, commented: “This is a significant, first step in establishing Vulcan as a revenue generating, renewable energy producer. German State and Federal policy increasingly supports decarbonising heating and power grids, with a focus on decentralised, renewable energy, and Vulcan intends to build a number of distributed geothermal renewable energy plants across the Upper Rhine Valley region.”
“Vulcan subsidiaries GeoThermal Engineering GmbH and gec-co (Global Engineering & Consulting-Company GmbH) have already been successfully active in Insheim for many years. We will capitalise on our local knowledge and expertise to continue to make a positive contribution to the energy transition in the region, while discussions with multiple local stakeholders to provide renewable heating to communities and renewable power to the German grid are ongoing.”