The fund is the largest ever created for residential solar systems, SolarCity said, and Google's $300 million equity stake is the technology giant's biggest renewable energy investment to date. SolarCity is the top U.S. residential solar installer.
As a so-called "tax equity" investor in the fund, Google can claim federal tax credits worth 30 percent of a solar project's cost to reduce its tax burden. Tax equity investors typically enjoy returns of 8 to 10 percent.
The remaining $450 million of the fund comes primarily from debt financing, according to SolarCity spokesman Jonathan Bass.
The investment is Google's second with SolarCity. The company in 2011 established a $280 million fund with the installer, which is backed by Tesla Motors Inc founder Elon Musk. To date, Google has poured more than $1.5 billion into renewable energy projects.