A consortium led by a Morgan Stanley (MS.N) infrastructure fund has made a second $150 million investment in unlisted Chinese hydropower company Zhaoheng Hydropower Holdings Ltd, Zhaoheng said.

The consortium had made a similar-sized investment in Zhaoheng in 2010 and the combined $300 million represents the largest private investment in China's renewable energy and hydropower sector so far, the company said in the statement.

Other members of the consortium include China-focused fund Fountainvest Partners and Asia buyouts fund Olympus Capital. Olympus previously invested $47.5 million in Zhaoheng in 2009, according to a statement on the private equity firm's website.

Zhaoheng said it plans to use the investment to buy hydropower plants and exceed one gigawatt of operating capacity over the next two years. The company now owns and operates over 30 hydropower plants in seven provinces with over 650 megawatts of installed capacity.

China is the world's biggest producer of hydroelectric power, with over 200 gigawatts of installed generation capacity. China's renewable energy law promotes growth of the hydropower sector, and the country's 12th five-year plan calls for China to grow generation of electricity from the sector to over 450 gigawatts by 2030.

The U.S. bank's investment in Zhaoheng is through Morgan Stanley Infrastructure Partners, which is a $4 billion global infrastructure fund of Morgan Stanley Infrastructure. The U.S. bank makes its infrastructure investments through Morgan Stanley Infrastructure.

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