A permanent magnet reluctance generator (PMRG) has a doubly salient pole structure. The permanent magnets are embedded in the stator yoke, and concentrated windings are arranged individually around each stator pole. On the other hand, the rotor has neither permanent magnets nor windings. Therefore, the PMRG has a simple and robust structure, and permits a multipolar structure. Its application to small-scale wind-turbine and hydroelectric power generation is expected. This paper presents a novel PMRG using ferrite magnets, which has almost the same output power as that using rare-earth magnets. Furthermore, it is proposed that a method for reducing toque ripple of the PMRG by cutting off the rotor pole-tips and canceling odd harmonic torque.