The Blue Lagoon is one of Iceland's most famous attractions - but few of those who relax in its hot, powder-blue depths realise that they are bathing in waste water from the Svartsengi geothermal power station, just a little way off.

The station ensures nearby towns have plenty of energy and hot water, in the process producing carbon dioxide - a gas long known to contribute to global warming.

But Carbon Recycling International has discovered a clever way to use this CO2 - by sending it to the UK for use in our cars.

Carbon Recycling International takes the CO2 from Svartsengi and transforms it into methanol.

23,000 litres of methanol will then be shipped to the UK, where it will be blended with regular petrol. The methanol will only constitute 3 parts per 100 of the final fuel, but it remains an impressive way to use a waste product which would otherwise be released into the atmosphere.

The total amount of methanol will be enough to fuel 40 cars for a year. This may not sound like much for a nation with more than 25 million cars on the road, but it demonstrates where technology could take us in the future.

Indeed, if Iceland could ramp up production, the proceeds for the small island nation could be significant.

Speaking to, Jamie Turner, professor of engines and energy systems at the University of Bath, said: “The fuel market in Europe is enormous – and any company that gets three per cent of the fuel market would be a huge revenue earner.”