The "correct" operation of this device appears to be a combination of the SmartMEG and the Adams Motor. The magnetization of the control coil cancels the field flowing through the flux gate. Then, reverse magnetization of the same causes flux from the control coil plus the flux from the magnet to magnetize the core. An output delay turn-on circuit may be required as a caveat to ensure magnet flux transport across the air gap. Excess energy can then be collected in the output coil.
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It seems like the efforts to find the best alternative energy sources are seriously being looked into by lots of countries including most US cities. One proof is the signing of the Kyoto Treaty. The main aim of the concerned group and individuals is to lessen the greenhouse gases and pollutants.