Nexterra, a Vancouver, B.C.-based developer of low cost gasification systems, has wrapped up a C$3.8 million ($3.6 million) fourth round of funding, courtesy of Calgary, Alberta-based investor ARC Financial Corp. This raises ARC’s total investment in Nexterra to well over $19 million.

The company’s gasification technology takes wood chips and other biomass waste products and converts them into clean-burning syngas (short for “synthetic gas”), which can be used to produce electricity and useable heat. The syngas can also be piped into boilers and dryers to generate steam and hot water. Nexterra’s systems could be deployed in a variety of industrial settings, including sawmills, pulp and paper mills and panelboard plants, to displace the use of fossil fuels like natural gas and oil.

The company claims the syngas can displace at least 60 percent of fossil fuel use in lime kilns; an even greater share of fossil fuels — 95 percent and, in some cases, up to 100 percent — could be displaced in pulp mills and many types of boilers, depending on the biomass feedstocks and system configurations.

The next systems it develops will operate on coal and other low cost fuels, CEO Jonathan Rhone says. Rhone thinks high energy prices and British Columbia’s recently enacted carbon tax will help spur his company’s business. Several U.S.-based waste-to-fuel companies that have taken funding in recent months include Boston, Mass.-based Ze-Gen, which raised $2.5 million, and Atlanta, Georgia-based EnerTech Environmental, which landed $42 million.