Look out, smart meter startups with IPO dreams — the granddaddy of power metering is plugging into the public markets. Elster Group, the German electric, gas and water metering giant founded in 1848, announced this week that it was filing to go public.

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Look out, smart meter startups with IPO dreams — the granddaddy of power metering is plugging into the public markets. Elster Group, the German electric, gas and water metering giant founded in 1848, announced this week that it has filed a registration statement for an initial public offering, seeking to place some 16.2 American depositary shares — 10.3 million of them new — to raise an estimated $152 million in net proceeds, mainly to pay down debt.

Elster has been quietly chugging away at the same smart meter markets it shares with the other 4 members of the “Big Five” of metering, which includes Swiss-based Landis+Gyr and U.S.-based Itron, Sensus and General Electric. Those markets are booming, thanks to the Department of Energy’s $3.4 billion smart grid stimulus giveaway last year and similar government support in Europe and China.

In the U.S., some 16 million smart meters were installed and another 34 million are under contract, according to August estimates. That adds up to a quarter of U.S. electric meters, up from a mere 6 percent installed last year. Pike Research predicts the global smart metering market will reach $3.9 billion by 2015 with some $19.5 billion in SPENT ON? meters installed.

At the same time, the Big Five and their smaller competitors are sharing the market — and sometimes the very guts of their meters — with a host of startups such as Silver Spring Networks, Trilliant, SmartSynch and others that can add value to these companies’ old technology. One big way is by bringing them in line with standards — until recently, all of the Big Five have had mostly, if not completely, proprietary systems.

That’s changing fast, however, with regulators in the U.S. and Europe working on open standards for smart grid deployments. Elster started pushing its IP-enabled EnergyAxis technology back at Distributech in early 2009, just about the time the U.S. Senate was debating making IP interoperability a requirement of smart grid systems. In April this year, Elster announced a successful IP implementation of EnergyAxis with Cooper Power Systems, and its technology has been certified by Swiss grid gear giant ABB for some distribution automation functions.

It’s not alone in seeking cross-platform partnerships based on new standards — Itron, Landis+Gyr and GE are busy doing the same. Landis+Gyr and GE meters use Silver Spring’s IP networking in Pacific Gas & Electric’s multi-billion dollar smart meter rollout. Itron recently linked up with Cisco, a champion of an IP-based smart grid and new owner of Arch Rock, a startup promising a fully standards-compliant network from the physical layer (the radios) on down. That’s a particular focus, since standards are still in development for the unlicensed 900-megahertz mesh networking used by Elster, Landis+Gyr, Itron and GE (Sensus, on the other hand, runs a star network over licensed spectrum).

Elster’s recent U.S. clients include Silicon Valley Power, Arizona’s Salt River Project, Kansas utility Westar Energy, and the Navajo Tribal Utility Authority, At the same time, it also has a strong hold in Europe and recent deals including a gas meter pilot project with European gas distribution giant GDF SUEZ (pdf) and a project with the distribution subsidiary of French utility EDF to develop an “interoperable and modular” smart meter.

Don’t forget Elster’s gas and water metering business. Chris King of eMeter estimates that some 22.3 million of the installed and approved smart meters in the U.S. aren’t electric. In March, Elster landed an all-in-one electric, gas and water smart meter deployment with Tallahassee, Fla.’s municipal utility, with plans to install 222,000 meters all managed over one network. A similar project linking broadband service with electric and water meters is underway in Columbia, Tenn.

Will Elster’s example be followed by Sensus and Landis+Gyr, the other two private companies in the Big Five? Both have lots of DOE-funded contracts, and Landis+Gyr raised $100 million from existing shareholders late last year, primarily to boost its U.S. presence.

To read more of my weekly insights, daily news clips and research reports on the smart grid check out GigaOM Pro (subscription required):

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