The acquisition by Squadron Energy, part of Mr Forrest's privately funded Tattarang group, is worth about $4 billion.
It will take Squadron's renewable energy operating portfolio that spans wind, solar and battery farms to 2.4 gigawatts.
Once fully operational, it will provide enough electricity to power 8.5 million homes, Dr Forrest said in a statement on Wednesday.
"Squadron is proud to bring a very significant portion of Australia's renewable energy assets home to local ownership," he said.
"It means that Squadron has the renewable energy critical mass to help Australia step beyond fossil fuels.
"We are committed to ensuring that Australians benefit from the rising employment opportunities, and massive investment in the renewable energy sector."
CWP provides renewable energy to customers including Transurban, Woolworths Group, Sydney Airport, Commonwealth Bank and Snowy Hydro.
Its assets include the Sapphire wind farm in NSW and Murra Warra farm in Victoria and it has approvals to construct four more wind farms in NSW.
The business was sold by Swiss-based Partners Group.
Squadron chief executive Eva Hanly said the purchase would allow the company to develop and operate a portfolio of wind, solar and storage assets that would ensure reliability of supply for customers.
"The sooner we can get renewable energy at scale into the grid, the more quickly prices will come down for consumers," she said.
Dr Forrest's Fortescue Metals Group has outlined ambitious multibillion dollar plans to achieve zero emissions by 2030.
He announced last month the iron ore business and climate-focused Fortescue Future Industries would link executive bonuses to meeting emissions reduction targets.
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