Is Silver Spring Networks preparing the year's biggest clean tech IPO?

Hotly tipped smart grid specialist Silver Spring Networks is set to become the latest clean tech company to float on the stock market after reportedly selecting bankers to handle its initial public offering (IPO).

Citing a source close to the deal, Dow Jones Clean Technology Insight reported late last week that the company is seeking to raise about $3bn (£2bn) through the planned IPO and has already appointed a number of banks as underwriters, including Morgan Stanley and Jefferies & Co.

A spokeswoman for California-based Silver Spring refused to comment on the reports.

The company specialises in networking technologies that enable the transfer of energy usage data and underpin smart grid developments. It has emerged as one of the leading players in the fast-expanding market, developing an order backlog of about $800m and securing many high-profile US utility customers, such as Pacific Gas & Electric, Florida Power & Light and American Electric Power.

It has also already pulled in about $255m in equity backing, including investment from venture capital firms such as Google Ventures and Kleiner Perkins Caufield & Byers.

However, the smart grid market remains highly competitive, with established infrastructure firms, such as IBM and Cisco, and rival smart grid specialists such as Trilliant and Landis+Gyr all jostling for position.

The funds raised through any IPO are expected to be used to help accelerate the development of new demand management technologies and execute the company's plan to expand into new regions.

The news will further bolster hopes that the IPO market is improving for clean tech firms following a busy few months that have seen a number of companies announce stock market listings, only for optimism to be quelled by several firms shelving IPO plans.