Construction has already started on TAGEnergy's Golden Plains Wind Farm near Geelong in Melbourne's southwest, with the site due to be fully operational in late-2025.
The wind farm's total planned capacity is 1300 megawatts or enough energy to power more than 750,000 homes across Victoria.
Ingka Investments, part of IKEA's largest retailer Ingka Group, on Thursday announced it had taken a 15 per cent stake in the $2 billion first stage of the Golden Plains development.
Ingka will also be able to claim up to 15 per cent of the project's electricity output to reduce its carbon footprint.
The new investment was part of IKEA's broader goal to halve its greenhouse gas emissions by 2030 and reach net-zero by 2050, IKEA Australia chief executive Mirja Viinanen said.
"We have done many investments, especially in European countries, but not so much so far in the Asia Pacific," she told AAP.
"Australia is a fantastic country to invest in good renewable projects. It has a stable economy, good companies and huge potential."
There are plans for IKEA to invest further in Australian renewable energy projects, with the hope other corporations would follow, Ms Viinanen said.
"We would like to attract and actually invite other companies, not just other retailers, to think mid- and long-term about investing into the right things," she said.
"It's not only about telling, it's about showing consumers and people around the world."
The funding appears to be the first direct investment from a major company into an Australian renewable energy project, TAGEnergy's Australian manager Andrew Riggs said.
"Everyone on the planet knows IKEA, so when IKEA is doing something, everyone's watching," he told AAP.
"We should sing it from the rooftops so that all of IKEA's peers and other industries say what a great way we can contribute through putting our capital into this industry."
As part of the first stage of the Golden Plains Wind Farm, 122 wind turbines will be created for 756 megawatts of energy.
The second stage, which is expected to start next year, will lead to a further 93 turbines being built for 576 megawatts of power.
The overall project is due to be completed by the end of 2025.
13°C