PETALUMA -- Solar power technology start-up Enphase Energy is preparing for what would be the North Bay's largest  initial public offering in years that could raise $100 million.

[caption id="attachment_39823" align="alignright" width="220" caption="Enphase's microinverter technology improves the efficiency of solar panels"][/caption]

Only five years old since its inception as PVI Solutions in 2006, the maker of microinverters for the solar industry has grown its staff to 243 and raised over $100 million in investor funding.

The company is currently closing another $51 million round in addition to filing for a $100 million IPO and has indicated it’ll continue to seek investor funds as well.

That looks like big plans, including acquisitions. The market for distributed optimization, of which microinverters are one solution, is heating up and competitors such as Enecsys, SolarEdge and Tigo energy are also on the prowl for green investment dollars.

The Enphase microinverter solution involves converting direct current (DC) electricity to alternating current (AC) electricity at the individual solar module level instead of a central inverter, thus distributing the power source as well as optimizing the output of each solar panel. Problems due to shade from other buildings or trees are largely mitigated.

According to Enphase CMO Bill Rossi, the system “increases energy production, simplifies design and installation and improves system uptime and reliability, reduces fire safety risk.”

Enphase has added a software component to allow data to be accesses and the system controlled from any Internet-connected device.

Other companies such as Tigo Energy are working on a competing technology called module level DC, which also increases energy production by mitigating the effects of shade.

Because of its status as first to market with a proven, reliable product Enphase is seen as ahead of the pack in funds raised – nearly twice as much as its nearest competitor – and market reach.

“We have grown rapidly since our first commercial shipment in mid-2008, with more than 750,000 units shipped through May 31, 2011, representing over an estimated 25,000 solar installations,” said Mr. Rossi.

With that in mind Enphase is moving rapidly to capture market share in Europe, where distributed optimization is largely unknown. The company opened offices in France and Italy this year and had a large presence at the recent Intersolar Europe expo in Munich.

In 2010, Enphase brought in $61.66 million in revenues, up from $20.20 million in 2009. However, the company lost $9.29 million for the latest quarter, $21.78 million for the full year 2010, and as of March 31, 2011, had accumulated a loss of $65.8 million.

Yet Enphase is well funded, with the recent S1 filing showing a cash reserve of $30 million, and gross margins continue to improve.

The company has bumped up the number of commercial installations that use the Enphase microinverter.