Smart Grid technologies apply modern technologies to the power distributions networks to improve efficiency. They improve the efficiency, reliability and safety of power delivery and use. Smart Grids can include smart meters and the networks they create.  A smart meter network replaces analog mechanical meters with digital meters and is network enabled.   Smart Grid technologies goals are to save consumers money, resources and reduce CO2 emissions.

Deploying the Smart Grid became the policy of the United States with passage of the Energy Independence and Security Act of 2007.  The act set out $100M in funding per fiscal year from 2008-2012 in addition to other reimbursements and incentives.   The Smart Grid is also being promoted by the European Union and other nations. The Smart Grids European Technology Platform for Electricity Networks of the Future began its work in 2005. Its aim was to formulate and promote a vision for the development of European electricity networks looking towards 2020 and beyond.

Modern technologies allow for intelligent power distribution network.  We now can reduce power consumption at the client side during peak hours (Demand Side Management), facilitate grid connection of alternative power (photovoltaic arrays, small wind turbines, micro hydro, etc.), create grid energy storage to balancing load, and improve reliability reducing risk of failure scenarios.  This is in great contrast to today's catastrophic widespread power grid cascading failures that have been experienced.

Today's transmission and distribution (T&D) network grid faces challenges to keep pace with the modern digital economy and information age, which require higher load demands, uninterruptible power supplies, and other high-quality, high-value services.  The system of alternating current power grid was created in 1896, based on Nikola Tesla's design published in 1888.   New microprocessor-based technologies alter the nature of the electrical load and can result in electricity demand that is incompatible with a power system that was built to serve an “analog economy.”   This can lead to electric service reliability problems, power quality disturbances, blackouts, and brownouts. However rapid advances in communications and information technology now provide electric utilities with opportunities to invest in critical grid infrastructure that can serve the growing demand for high quality, “digital-grade electricity.”

Investing in Smart Grid technology can mean investing in the Electric Grid, investing in power management companies, investing in grid infrastructure and investing in electric monitoring equipment manufacturers.