The recently formed Ze-gen has stated that is has raised $20 million in order to commercialize its melted iron technology that turns trash into power or heat.

The amazing system works by dumping construction and municipal waste into a swirling pool of liquid iron. The extreme temperature pulls carbon from the trash and breaks hydrocarbons into syngas – a combination of carbon monoxide and hydrogen.

The syngas can then be burned to generate electricity or create heat. The cost of producing the syngas is comparable to natural gas prices in the United States.

Considering there are 400 billion pounds of waste produced in the world each year, like recycling, this system could help to reduce waste in landfills which are notorious producers of methane.

Ze-gen currently has a test plant in New Bedford, Mass. that has been turning approximately one ton of waste into syngas per hour for five hours each day. They plan to have several fully operational facilities by 2012.