TOKYO - Japan's Sustech is set to raise $50 million from investors, valuing the energy tech startup at more than $800 million, people with knowledge of the matter said, as the Tokyo-based firm looks to tap fast-growing demand for cleaner energy worldwide.

The valuation of 124 billion yen ($816 million) for Sustech in its fourth round of fund-raising marks a 3.5-fold jump from the 35 billion yen valuation last year, the sources said, bringing it closer to joining fewer than a dozen Japanese unicorns worth over $1 billion.

The sources declined to be identified as the matter is private.

The surge in valuation is being driven by robust global appetite for investment in clean energy technology and infrastructure, which the International Energy Agency estimates would hit $2 trillion this year - twice the amount going into fossil fuels.

Founded in 2021, Sustech builds renewable power plants to help reduce clients' carbon footprint and develops artificial intelligence (AI)-based systems for predicting power generation and maximising profits from power sales in the wholesale market.

The latest funding round was led by ceramics maker NGK Insulators, which is already in partnership with Sustech in the energy storage plant business, according to the sources.

The capital raised will help fund the construction of renewable energy plants and development of AI to improve power grid stability, which is increasingly crucial as more wind and solar resources are added to the power grid, the sources said.

Sumitomo Mitsui Trust Group as well as former SoftBank Group chief strategy officer and startup investor Katsunori Sago are among some of the 30 investors in Sustech. The firm is aiming to make a Nasdaq market debut by early 2028, the sources said.

The company has launched a 150 billion yen fund with property developer Tokyu Land and a 20 billion yen fund with transport operator Ryobi Holdings to build renewable power plants. ($1 = 151.9300 yen)

(Reporting by Makiko Yamazaki; Additional reporting by Leika Kihara Editing by Shri Navaratnam)