A smart grid is an advanced electrical grid system that uses digital technology to enhance the reliability, efficiency, and sustainability of electricity services. It operates by integrating communication and information technology with conventional power systems. Key components include smart meters, sensors, and automation tools that facilitate real-time monitoring of energy consumption and distribution. Smart grids enable two-way communication between utilities and consumers, allowing for demand response capabilities, energy conservation, and the integration of renewable energy sources. This technology ultimately leads to reduced energy costs and improved grid stability.