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The Pros and Cons of Smart Grid IoT Deployments

Smart grids are enabling utilities to more effectively manage their delivery of services to customers.


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Göran Näslund, Strategic Segment Manager
June 29, 2022

By monitoring data from across the generation chain down to smart meters and through networked sensors across the smart grid, suppliers are able to ensure their energy is available to customers when and where they need it and unnecessary generation is eradicated, thereby reducing environmental impacts of energy supply.

What is a smart grid?

A smart grid is a utility supply network that relies on digital communication technologies to detect and react to changes in consumption and generation habits. Focused on balancing demand with supply, especially from renewables in the electricity industry, smart grid technology is eliminating wasted power generation.

Utilities have invested in smart grid infrastructure in the form of smart meters, sensors and networks to create smart grid systems that continuously gather data on consumption and in the case of electricity grids, power generation from renewables. With brown-outs happening in many parts of the world because of power demands placed on grids, understanding likely peaks and falls in demand is essential for utility providers.

With these insights they can match power generation to demand and ensure customers are supplied with the power they need, when they need it. Conversely, excess generation, such as firing up a fossil-fuelled power station to meet expected demand, can be avoided if the grid has sufficient knowledge of plentiful renewable energy in a specific area at a given time. Another significant benefit is that it encourages users to reduce consumption during peak demand.

Smart grid and renewable energy

The advantages of smart grids include being able to balance demand with supply across the network and to match generation with expected demand. The added complexity of customers also becoming suppliers thanks to having their own renewable energy generation capability means the utility isn’t alone in controlling generation capacity and therefore needs far more information on supply and likely demand.

The impact of renewable energy on the grid is significant and comes at a time when there are increased constraints on sources of non-renewable energy, such as oil and gas. In addition, battery technology has improved and it is anticipated that large batteries may be employed to store energy generated from renewables with greater efficiency than before.

Features of an intelligent grid

Consumption patterns are changing. Increased home working is seeing some power consumption move from centralized city locations to workers’ homes. At the same time, EV adoption places heavy demands on smart grids. The early promise is that smart grids will enable users to buy electricity at cheaper prices for use at off-peak times and use it for tasks such as electric vehicle (EV) charging.

Intelligent grid provide users with insights into price levels and can therefore stimulate usage of electricity at certain times of the day. EV chargers can communicate with the grid using standard protocols and get price levels for the next 24 hours and can execute charging accordingly.

Known behavioural patterns mean the smart grid can spin up generation to meet the needs of EV charging while simultaneously turning to better batteries and more efficient controls, IT, power lines and always-connected data to help the grid manage the new forms of demand placed upon it.


Intelligent grids require sustained large investment in all the areas listed above and that presents a significant barrier to roll-outs. The complete replacement of previous generation, non-smart meters is required and this is only part of the total cost of smart grid deployment. Smarter technology is reducing costs and counterbalancing declines in investment in grids.

Smart electricity delivery relies on connections to communicate the data from the smart meter to the smart grid systems and innovation here is increasing choice and offering cost efficiencies to smart grids. On top of the connection and the meter, the collected data then need to be analyzed so insights can be extracted and decisions and actions be made.

Automation of processes will be achieved through applying artificial intelligence and machine learning to smart grid data but there are many variables to consider and different business models that affect smart grid benefits and smart grid features. It is essential for smart grid operation that a network of smart meters and sensors is in place to feed it with information to enable it to optimize smart grid operations.

Which industry sector has IoT technologies to deploy smart grids

Smart electricity delivery involves the coming together of technologies and skills from different industries. Fundamentally, metering specialists need to collaborate with connectivity providers and data processing experts in order to create the insights that fuel efficient smart grid operations.

Smart grid communication technologies have advanced rapidly in the last few years and much of the industry has moved to wireless smart meters. This is because these are faster and easier to deploy and provide a lower cost means of ensuring devices, even in hard-to-reach locations, can be connected. Cellular technologies such as LTE-M and narrowband IoT (NB-IoT) are widely used, and these are connecting the latest generations of smart meters which supply the information smart grid features need to deliver benefits to power and utility providers as well as their customers.

Beyond smart grid systems

This infrastructure doesn’t have to be exclusively for smart grids. The connection may be used to enable a home area network in which other service providers can engage. Care will need to be taken here because users are sensitive about their personal data being mis-used or being handled insecurely.

Smart grid IoT is introducing a new era of precise information about generation and demand for utilities. It supports two-way business models and securely enables granular information to pass from consumers and producers to the grid to ensure not only that supply is available but that it is optimized.

The advantages of smart grid IoT offset its costs and robust technologies are in place from specialized vendors, such as Telenor IoT which is well positioned to support smart meter deployments by utilities players and ensure user data remains secure, available and ready to support the smart grid.

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