This technique doesn’t actually invent something new. It’s just a combination of normal mapping and billboards to realistically lit particle systems. It has been used successfully in many games to fake volumetric smoke.

The movie below shows an example of a lot of particles, rendered as billboards that are normal mapped to look like spheres.

Lit smoke and Post-process system design (also in the book ShaderX 5)
http://www.gamedev.net/community/forums/topic.asp?topic_id=432218&whichpage=1?

A thesis that tried to implement this method (some interesting info, but results aren’t good enough)
http://epubl.ltu.se/1404-5494/2008/011/LTU-HIP-EX-08011-SE.pdf

Some discussion about normal mapped billboards
http://www.drone.org/tutorials/lighting_flat_objects.html