By Simon Jessop

LONDON (Reuters – NextEnergy Capital reported Monday that it has raised $896 Million for NextPower III ESG, its largest private fund. The fund invests in the solar infrastructure of OECD nations.

Although larger funds that are solar-focused may be available with more restricted geographic focus, this firm claimed its most recent was the largest of its type to raise money with a broader mandate.

As the price of solar technology continues to drop, the hard-closing of the fund has exceeded its $750 million target. This is driving increased demand from countries trying to reduce carbon emissions.

Participants in the November global climate negotiations in Scotland agreed that they would accelerate their efforts to limit global warming. This included decarbonizing their economies, shifting away from fossil fuels and accelerating energy transitions.

Investor demand continues to rise for investment that addresses environmental, governance and governance (ESG),-related issues such as climate change.

Michael Bonte Friedheim (group CEO, founding partner) stated: “There was an immense amount of investor interest.”

“I am looking forward to the continued development of the fund’s portfolio given the depth and quality of its current pipeline,” he added.

NextEnergy stated that the fund will target projects in the United States and countries such as Portugal, Spain and Chile. NextEnergy has made investments already with an installed capacity 742 megawatts, across 23 projects, two portfolios, and has invested in a total of $742 million.

The fund’s investors include family offices, pension funds, and insurance companies. NextEnergy’s total capital is $905million, which includes money from outside the fund.

The fund’s installed power capacity will exceed 2.5 gigawatts when fully invested. This would be enough to meet the energy needs of approximately 1.3million homes annually.

Following the sale of 105 solar panels totaling 149 megawatts, NextPower III ESG funds closed, the fund said. This helped to generate an internal rate return for investors exceeding 25%.