Around $250 million (£160m) will be invested in renewable projects in North Africa and the Middle East.
The fund from aims to boost green energy generation in Morocco, Egypt, Tunisia and Jordan.
Most of the energy produced will be sold directly to private sector consumers such as cement companies and hotel groups.
According to the European Bank for Reconstruction and Development (EBRD), the first project under the fund is expected to be a 120MW wind farm near Tangiers, one of the first private renewable projects in Morocco.
EBRD’s Nandita Parshad said: “For the first time in this region the private sector is now able to produce and sell clean renewable energy on a commercial basis competing head to head with gas and oil-fired generation.”