2019 5th Conference on Knowledge-Based Engineering and Innovation, Iran University of Science and Technology, Tehran, Iran
Internet of Energy (IoE) in Smart Power Systems
Hossein Shahinzadeh
IEEE Member, Department of Electrical Engineering
Amirkabir University of Technology (Tehran Polytechnic)
Tehran, Iran
h.s.shahinzadeh@ieee.org
Gevork B. Gharehpetian Hamed Nafisi
Prof., Department of Electrical Engineering Department of Electrical Engineering
Amirkabir University of Technology Amirkabir University of Technology
Tehran, Iran Tehran, Iran
grptian@aut.ac.ir nafisi@aut.ac.ir
Abstract— The accelerated trend of development in the areas
of information and communications technology (ICT), as well as
energy systems, has been led to emersion of a new concept called
the internet of energy (IoE). This concept is classified as a
subsector of the internet of things (IoT), which means the
utilization of advanced digital controllers, sensors, actuators, and
meters with the ability of information exchange through IT
infrastructures. The phrase “internet”, in this context, does not
exclusively refer to the World Wide Web rather than any type of
server-based or peer-to-peer network. These communicational
tools are able to receive information for local analyze and
control, receive analyzed commands, send raw data, or send
instructions. The incorporation of IoT in power systems conveys
a brilliant future for overcoming power system operation hurdles
and environmental challenges, although it incurs a large capital
investment portfolio initially. However, it is hoped that the
evolution of current technologies and the advent of new
technologies with economically affordable prices can help to
increase the pervasiveness of these state-of-the-art technologies.
IoE covers the entire energy scope such as thermal or electrical
energies. However, in this study, the applications of IoE in power
systems, as the central core of the energy ecosystem, will be
addressed. At first, the basic terminology of this topic such as
IoE, IoT, plug & play capability, smart energy, future networks,
smart grid 2.0, energy 4.0, prosumers, AMI, API, digitalization,
and grid edge are described to make the rest of paper more
intelligible. Then the role of IoE in supply-side and demand-side
of power systems encompassing renewable generation section,
large-scale energy storage section, thermal power plant section,
system operation and protection as well as execution of demand
response programs (DRPs), microgrids, integration of plug-in
electric vehicles with V2G capability, and end-user residential
consumption management in smart buildings are explained. In
this study, it is tried to outline a different classification of IoE in
power systems which has not been drawn by previous similar
works.
Keywords— Internet of energy (IoE), Internet of things (IoT),
Digitalization of power systems, Energy 4.0 and smart grids 2.0,
Information and communications technology (ICT) infrastructure;
978-1-7281-0872-8/19/$31.00 ©2019 IEEE 627
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Jalal Moradi
Young Researchers and Elite Club
Khomeinishahr Branch, Islamic Azad University
Esfahan, Iran
sj.moradi@iaukhsh.ac.ir
Mehrdad Abedi
Prof., Department of Electrical Engineering
Amirkabir University of Technology
Tehran, Iran
abedi@aut.ac.ir
I. INTRODUCTION
Internet of energy (IoE) is a cutting-edge concept in the
field of energy research which is a combination of energy
systems and information and communications technology
(ICT). IoE is classified as a subcategory of the internet of
things (IoT). In the IoT concept, all objects are connected to
each other through modern communicational platforms and
the internet. Hence, IoT is known as the third revolution in
information technology [1]. IoT drastically improves the
smartness and automation levels of systems. It also improves
the visibility of complicated systems and procures real-time
monitoring. The power systems are regarded as the central
core of the energy ecosystem. IoE is an indispensable part of
the implementation of smart grids and its corresponding
components.
There are some studies conducted on the IoT applications
in the energy sector, particularly in various parts of power
systems. A comprehensive review is carried out in [2], where
the various applications of IoT are described including the
implications of IoT in power systems. The fundamental terms
pertinent to IoT (such as Identification, sensing,
communication, computation, semantics, and services) are
explained in this work. The authors, in [3], have evaluated the
roles of IoT in smart grids. In this work, different layers of IoE
in power systems are concisely described. For example, the
applications of IoT in smart electrical grids (such as demand-
side management (DSM), renewable energy sources, power
lines and monitoring of faults, smart homes, electric vehicles,
smart meters, demand response modeling) as well as
management services provided by IoT (such as security
control, planning, power flow data, system monitoring data,
distribution process data, load management data, customer
profiling data, and pricing and market data). Besides, different
types of gateways and networks (such as WiFi, WiMax,
Zigbee, Bluetooth, cellular, power line carrier (PLC), green
radio, 6LoWPAN, Zwave, Gateways, 2G, 3G, 4G, 5G, optics
fiber, and cognitive radio) and sensors connectivity
technologies (such as radio-frequency identification (RFID),
wireless sensors, cameras, barcodes, intelligent electronic
devices (IEDs) etc.) are mentioned. In [4], some applications
of IoT in electrical grids are discussed. In the mentioned work,
the dynamic stochastic energy management system is
presented. Besides, the role of IoT in smart homes, electric
transportation, and the open challenges in digitizing electric
power T&D networks are elaborately discussed. In [5], the
challenges and solutions for the integration of IoT in smart
homes are presented. A comprehensive study on the
deployment of IoT in smart cities is represented in [6]. The
authors in [7] have investigated a solar energy harvesting
system which takes advantages of IoT devices. In [8], the
applications of IoT in microgrids are investigated. A review is
performed to show the role of IoT in the integration of electric
vehicles [9]. The energy management schemes of energy
storage facilities and electric vehicles are introduced in [10].
In addition, real-time generation scheduling for the renewable-
based power systems incorporating IoT is presented in [11].
As it is obvious, so far, all studies conducted on the roles of
IoE in electrical grids have focused on a specific aspect among
different scopes of power systems. Thus, the lack of a broad
classification is observed to meet the need for a rigorous
overview of this topic. This paper attempts to outline a
comprehensive classification for IoE applications in all facets
of power systems in various layers. This categorization
provides a precise overview of IoE in power systems. In the
following sections, the implications of IoE in various sectors of
power systems from the supplier-side to end-user side are
introduced. Hence, the role of IoE in operation of power
systems, microgrids, integration of renewable resources,
demand response, integration of electric vehicle with V2G
capability, and smart buildings will be explained in this study.
Then a concise summary is given to explain each sector.
Afterward, the deficiencies and open challenges in each sector
along with the way IoE helps to improve the condition of that
sector are described.
II. INTERNET OF ENERGY (IOE)
The recent developments in renewable energy section,
telecommunication equipment, controlling schemes, power
supply, and storage technologies, information technology,
cybersecurity, computer, and particularly IoT have been led to
the advent of a new concept known as the internet of energy
(IoE) [12]. The internet of energy expression officially and
systematically was first coined by Jeremy Rifkin, an American
economic theorist, in his best-selling book titled “The third
industrial revolution”, and he has investigated the impact of
technological and scientific changes on the economy, energy
sector included. In general, IoE refers to a new paradigm for
the operation of some elements in power systems such as
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renewable energy sources, distributed generation resources,
hydrogen-based generation resources, plug-in electric vehicles
(PEVs), and a variety of energy storage technologies for
different applications, which can be monitored or controlled
through the internet platform [13]. The phrase “internet” in
IoT and IoE concepts has a wider meaning than thecommon
World Wide Web. As a more general content, any form of
network is regarded as the internet or internetworking (IW).
The IoE has a wider content than the smart grid in term of the
diversity of resources. For example, gas network and electrical
grids and their interconnections can be observed in the energy
ecosystem and can be monitored, metered, and controlled
using advanced Internet-based infrastructure. The information
must be securely and quickly shared with corresponding
centers and the required actions must be automatically taken
while big data and cloud-computing architectures may be
incorporated. Using internet infrastructure improves the
observability (visibility) and controllability of the entire
energy ecosystem. Due to the existence of a large diversity of
devices, equipment, energy forms and their correlated inherent
behavior, intermittency of many parameters in energy field,
and phenomena with unpredictable or chaotic nature, it is
necessary for IoE to transfer and analyze a large amount of
information in approximately real-time operation and making
decision and taking commands with a slight delay.
Meanwhile, the validation and correctness of information must
be guaranteed which may be threatened by unintentional or
deliberate interruptions or cyber-attacks. The verified
information must be only accessible for competent people in
authority as well. If the current concerns associated with
information and communications technology (ICT) is
resolved, the IoE concept can be effectively implemented in
various parts of energy systems [14].
Nowadays, some novel concepts are introduced in the area
of energy research such as the second generation of smart
grids (smart grid 2.0) [15], smart energy, future energy
networks [16], industry 4.0 [17], which are connected with
internet and telecommunications technologies.
Smart grid 2.0 refers to the next generation of smart grids
which will be implemented from 2020 which has specific
distinctions such as increase in interactions between supply-
sides and demand-side using advanced smart metering
infrastructures, share of energy and its correlated information
between deserved players using informatics infrastructure, and
the plug & play capability, which means the ability to provide
energy even by tiny-scale generation resources (e.g. V2Gs) so
that they can be able to deliver power to the grid as easy as
plugging in a plug into an outlet. Such a consumer which can
sometimes play the role of a provider is called “prosumers”. It
is noticeable that the ability of connection or disconnection of
distributed generation at each desired moment is not possible
at the current time. However, in smart grid 2.0, a wider range
of consumer devices and equipment will be in control which
provides more flexibility for power systems. The control of
such a massive number of elements cannot be viable without
improving the smartness of grids. It is alleged that more than
50% of demand will be controlled by real-time controllers in
smart grids 2.0. In such an environment, all players can
participate in power markets and monitor its transactions and
power exchanges using an internet-based interface in peer-to-
peer (P2P) mode, in which the buyer and seller are specified.
In the first generation of smart grids, the main attention has
been focused on the development of fundamental prerequisites
such as advanced metering infrastructures (AMI), and the
installation of them in the local distribution networks.
However, the smart grid concept will be more globalized at a
wider level using IoT-based interfaces and will be inclined
toward a macro-level and worldwide pervasiveness. The smart
grid 2.0 must be able to keep working after any contingency
automatically and effectively so that the infected region
immediately begin to be supplied using self-healing schemes,
which highly depends on real-time data gathering and
analysis. In addition, the proper application programming
interface (API) will be employed as a platform to display
information for P2P and third-party access [18].
Smart energy refers to a platform for integration of all
kinds of energy into a single management model using rich
databases and online information connections to provide
further monitoring of energy usage than exclusively electric
power. As an instance, the energy consumptions for fuel in
transportation or heating can be monitored.
The concept of future networks (or future grids) refers to
some state-of-the-art concepts in the energy sector and leads
with the future expansion of energy systems. The more
utilization of microgrids, electrification, and decentralization
of generation resources, digitalization, and energy sharing are
some of them. All technical requirements for modernization of
power systems are classified into four layers encompassing
data analysis layer (including visualization, AMI data
analysis, distributed energy resources analysis, equipment’s
data analysis), application layer (supervision of equipment,
data management, DERMS, AMI), communication and
control layer (including AMI connection network, internet-
protocol-based networks, supervisory control and data
acquisition (SCADA), bidirectional wired or wireless
communication protocols such as Zigbee, WiFi, HomePlug,
power line carrier (PLC), GPRS, WiMAX, LTE, Lease Line,
and high-bandwidth 5G wireless communication), and
physical equipment in grid edge layer (including smart
metering devices, supervisory and monitoring equipment,
storage equipment, voltage control equipment, protection
equipment, modern sensors, and switches of the power grid)
[19].
Industry 4.0 is the name given to the 4th industrial
revolution while observing the trend of automation. The
previous generations were the invention of the steam engine
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and the use of steam power, the invention of electricity, and
industrial automation [20]. The 4th generation of industry
points out some items such as IoT, cyber-physical systems,
cognitive computing, and cloud computing. Energy 4.0 is also
another terminology which offers a fascinating insight into
sustainable strategies and innovative technologies for future
energy on the way to post-fossil societies. The era of fossil
fuel burning, the era of fossil-based electricity, and the era of
renewable energy are three previous generations and the era of
digitalization of energy sector is referred as energy 4.0 which
features deployment of IoT sensors, cloud computing, big data
analysis, cybersecurity, high-performance and economical
solar systems, the control of grid in various voltage levels
regard to data gathering and data analyzing using
communicational platform, and providing more interactions
between the utilities and end-users through digital interfaces.
The energy sector has entered the era of energy 4.0 by the
implementation of the smart grid and will continue toward a
brilliant future [21].
In the following parts, the concept of IoE will be explained
for various parts of power systems. IoE is basically segregated
into three categories. The first is generation resources such as
electrical generation resources (hydropower, wind, solar,
thermal etc.) and non-electrical (crude oil, gas, coal, biofuel
etc.). The second is energy consumption including electrical
usages (such as an electric heater or electric vehicles) and non-
electric usages (such as heating or transportation). The third is
electrical energy storage (pumped-hydro storage, compressed
air energy storage etc.) or non-electric energy storage (fuel tank
for storage of crude oil, gas, and petrol).
III. IOE IN POWER SYSTEMS
Various parts of the electricity network will be heavily
influenced by information and communications technology as
well as cutting-edge advances in instrumentation and
automation. These impacts can be investigated for the supply-
side sector, and demand-side sector where the following
concepts can be mentioned and explained:
A. IoE in supply-side
1) IoE and renewable energy section
Renewable energy sources (RES), also known as green
energy, is the sustainable solution to tackle with various
problems caused by excessive consumption of fossil fuels and
production of large amount of air contamination and emission
of greenhouse gases, which are compromising the natural cycle
of the life on earth and have caused different environmental
issues. Current power systems heavily rely on fossil fuel for
energy. The large penetration of RES, particularly wind farms
and solar parks, requires a massive investment. In addition, a
large capacity of quick-start fast-response generation must be
provided as reserve capacity to compensate in emergent
conditions.
 Past Present
Information Flow System Transmission Control Distribution Control
Power Flow Operator
PV
Residential
Residential
Transmission Customer Control Centre Substation
Customer
Substation
Distribution Wind Distribution
Transmission
Substation

Substation Industrial
Industrial
Thermal Power Station Customer Thermal Power Station Customer Commercial Customer
Commercial Customer

Future
Transmission Control Centre Control Centre
Charging
Office
Station
Charging
PV Station

V2G
V2G

Residential
Wind Distribution Customer
Transmission
Distribution
Substation
Retailer

Hydro & pump- Network management and Industrial

storage power Thermal Power Station Storage data center Storage Customer Commercial Customer

Fig. 1. IoE and future networks

Furthermore, a large penetration ofRES threatens the
security and stability of the grid due to the reduction of power
system inertia. Thus, the energy experts are struggling to
achieve sensibly economical renewable generation resources
with better performance and a higher level of observability and
controllability. Assuming such improvements in technology,
the main hurdle that such units are encountered with is the
intermittency of RES. Wind energy is so volatile and solar
energy is intermittent.
The large-scale harness of RES is intended to be discussed
in this section, and the small-scale distributed renewable
generation will be discussed in section B.1. The stochastic
nature of RES mitigates the reliability of the power system
and may cause load shedding to the loads. It also makes the
generation scheduling more sophisticated while the
consumption of demand is fluctuating too. In this regard, a
considerable share of harvestable RES is being curtailed.
Paying attention to the modern structure of power systems, the
countries and governments tend to implement highly
competitive energy markets, electricity market included. This
measure requires large privatization and massive contribution
of private equities. The owners of such units are not willing to
pay penalties for deficiency or loss profit due to curtailment.
They are also banned to participate in ancillary services
markets. Hence, the implementation of IoE infrastructure in
the renewable sector for accurate online state monitoring and
use of the advanced internet-based remote controlling
equipment can boost the profitability of such units [22].
In addition, modern market structures are proposed based
on the large penetration of RES. The deployment of real-time
generation tracking tools and corresponding demand-side
interfaces can connect suppliers to the insensitive customers
(e.g. private storage units) who accept the risk of
intermittencies instead of a more economical price of
electricity. Such ideas will be matured further in the future.
The real-time monitoring (and control) of renewable
generation will be managed in large-scale rather than local
scales, which procures an integrated free clean energy
harvesting of RES that yields system-wide benefits and
facilitates the generation scheduling and energy management
in power systems.
IoE is making revolutionary changes in the expansion of
solar and wind sectors in large-scale. Without internet
platform and communicational equipment in the future, the
management of a huge number of elements in the grid,
particularly in renewable section, cannot be perform using
traditional methods with the intervention of humans. In
addition, the data corresponded with each element must be
transferred as quickly as possible to the local, regional or
national centers. The data must also be analyzed and proper
controlling commands must be issued and executed. The wind
turbines in a wind farm and photovoltaic panels in a solar park
are usually clustered in a wide area of land. When a system

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becomes too complex and dispersed by having a myriad of
factors to be checked, it can cause logistical problems for the
executive operators. To ensure the proper real-time state of all
elements of each individual item, a lot of expenses must be
spent (salary of the workforce, transportation of technicians,
waste of time etc.) in long-term. These hurdles mount the
vulnerability of the grid considerably. Real-Time state
monitoring easily tackles such problems in the exploitation of
RES. As an example, some kinds of wireless ready-to-connect
with built-in security bundle solutions are cellular modules
and routers, containing an embedded SIM, pre-connected to
the global mobile networks that can be used to facilitate an
end-to-end system for IoE [23]. This technology is designed to
be used in solar parks and wind farms. While some challenges
exist toward developing pervasiveness of IoE in the RES
sector, they are not debilitating for RES companies. By using
IoT in the RES sector, especially solar and wind parts, many
of these issues can be resolved with a sensible investment and
little effort. The installation of a simple fully-integrated
system, which enables the operators to manage the entire grid,
is the key to success. This also gives them the ability to
distinguish and fix problems in near real-time. The main
advantage of employing IoT in solar and wind energy is that
all things that are happening with all your assets can be
monitored from one central control panel. The origin of any
problem can be found before the disruption of the entire
system [24].
2) IoE and energy storage technologies
The current trend of fossil fuel consumption, deforestation,
old transportation systems are alarming the future of life on
this planet. The energy experts have declared that more
exploitation of RES is necessary to revive the earth. The
commitment of RES in satisfaction of demand causes a set of
problems for power system operation due to intermittent
nature. In addition, large penetration of RES can cause
problems such as the duck curve problem in California
because the thermal power plants cannot sustain steep ramp
rates. The solution to tackle problems is to utilize energy
storage (ES) facilities [25]. Energy storage technologies are
specified for three main purposes of bulk energy time-shifting,
frequency regulation in small-scale, frequency stability in
large-scale, and power reliability (reserve) [26]- [28]. So far,
various ES technologies are developed for different
applications. Pumped-hydro energy storage (PHES) [29], and
compressed air energy storage (CAES) [30] are the two most
successful schemes for bulk energy time-shifting purpose. In
addition, some emerging types of ES are introduced such as
the advanced rail energy storage (ARES) [31], the underwater
compressed air energy storage (UWCAES) [32], the liquid air
energy storage (LAES) [33], ocean renewable energy storage
(ORES) [34, 35], and the blue battery in green power islands
[36], which are tested as prototype or in pilot scale and can
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work in large-scale applications. Fly-wheel, fuel cell, and
different batteries are usually used in small-scale applications
such as power quality and frequency regulation. The large-
scale applications will be discussed in this section and the
small-scale demand-side applications will be presented in
section B.1.
If the IoE infrastructure is implemented to large extent, the
various parts of the power grid can have better coordination
with each other. Energy storage units play a key role in
increasing the flexibility of power systems and ensuring
reliable operation. RES are obliged to curtail their excess
generation in a restructured environment. The deficiency in
generation must also be compensated from the real-time
market. This fact decreases the profitability of RES. To tackle
this problem, RES should have a collaborative operation with
a storage unit to be supported against volatilities. On the other
hand, the excess generation of RES will be sold to ES with an
alleviated price than the real-time market clearing price. This
matter can materialize better profitability for both of them.
However, the positive or negative imbalances of RES will
be determined in near real-time. Thus, a proper reciprocal
communicational platform is needed to connect RES and ES.
If the RES and ES are located on different buses, the trade
must be transmitted through the lines. In this case, the system
operator must observe all transactions and trades to retain the
secure operation of the grid. Thus, the deployment of IoT for
real-time data exchange between the system operator, RES,
and ES is indispensable. Hence, IoE in the ES section
improves the RES extraction and helps to attain better real-
time observability and controllability to redress the
imbalances using ES technologies. The integrated model of all
storage capacities dispersed in a power system is illustrated in
Fig. 2.
Factory storage
Renewable storage
IoE Office storage
Grid storage
Commercial storage
Household storage
Fig. 2. The energy storage management by IoE
3) IoE and Thermal power plants
The presence of thermal units is a necessity for
guaranteeing the expected reliability and resiliency of power
systems. They also are used to maintain the base load.
However, due to emission and environmental facets, the role
of them will be mitigated in future grids and they will be
replaced by RES to large extent. But the load satisfaction with
exclusively relying on RES significantly threatens the security
of the grid. In addition, fast-response units, such as gas-fired
units and combined-cycle generation units are good
alternatives in emergencies. The coal-fired and nuclear power
plants are not desired for future expansions due to
environmental issues. The conventional steam plants have also
low efficiencies and have operational restrictions. They are
also so rigid and have slow flexibility for controlling
commands. Gas-fired units will also be called for commitment
as late as possible due to high operation cost. Thus, in future
power grids, the IoT probably will have a slow evolution in
this sector compared with other parts of the power grid. It is
because the goal is to mitigate the commitment of thermal
units. However, the data of all thermal units must permanently
be sent to the control center to be observed along with all data
acquired from other sectors of the power system. Thus, the
secure high-speed communicational platform must be
accessible for all thermal plants. The IoT infrastructure can
also help the power plants’ owners to track the state of health
of all equipment in the power station using advanced sensors.
Thus, proper preventive maintenance schedules can be
arranged and executed to prevent financial detriments due to
failures and increase the availability of thermal plants. In
time control over equipment increases -addition, the real
enjoying IoT infrastructures for various elements of a
conventional thermal plant, which can be led to efficiency
.improvement
be managed automatically using IoE infrastructure. It must be
mentioned that the system operator is faced with a massive
amount of uncertainty in the model, and the power system has
also its inherent features that make the scheduling more
complex. The scheduling must comprise various items such as
the features of all kinds of generation resources, the state of
transmission and distribution components, and the modeling
of various types of loads. In addition, the security constraints,
the demand response capacities (as virtual power plants
(VPP)), and the impact of storage units must be integrated.
IoT helps the operator to procure better incorporation of
existing components and assets and their associated modeling
[37]. Besides, modern protection schemes and techniques can
be employed and digital protection equipment can be installed
which sends instantaneous reports to the protection centers
using ICT infrastructure. This matter can prevent the
catastrophic consequences of contingencies such as blackouts.
B. IoE in Demand-side
1) IoE and microgrids
A microgrid refers to a localized group of electrical loads
and small-scale generation resources (microsources), which
can satisfy all or part of its demand to large extent.
Geographical
information system

4) IoE and power system operation and protection Switch

Preventive
control
maintenance system
IoE will play a substantial role in future power systems. Capacitor
bank
The integration of RES is mounting in the grids. This matter Frequency
Collaborative
helps to alleviate the costs of operation and to reduce operation
control
Power line
emission. However, the uncertainty in power system operation monitoring
Transformer
will be increased which can threaten the security of the grid. Distribution
monitoring
management system
To ensure security, part of uncertain renewable generation Distributed
Generation
may be curtailed and load shedding measures may be Outage management Substation
metering
imposed. However, by the implementation of IoT system Electrical
Vehicle
infrastructure, revolutionary changes will occur in the Access
charging
Meter Data
operation of the grid. The system operator has access to rich Management control
Transformer
instantaneous databases that gives better visibility and smart meter
monitoring of the system. In addition, the operator has more Federated Access
Workforce
management
control over small-scale loads. This matter can be managed Energy
storage
automatically by incorporation of IoT-based devices. For Data Management Preventive
maintenance
example, if the operator decides to reduce the consumption in System
system
Smart meters
a certain feeder in the distribution level, a corresponding Customer
residential
signal will be sent to the targeted regional distribution center. information system Fault detection
That center can also send a similar signal to all consumers on VOLT-VAR
that feeder. Each individual consumer may also have various Enterprise resource
planning Harmonics
pre-defined and adjustable controlling schemes and they may filtering

be equipped with certain IoE-based interfaces and automatic Demand response

Grid side
Distribution
controllers that inform the consumer to reduce its & DSM feeders
consumption. In addition, pre-defined strategies for energy
Network operations Centre
consumption reduction may be defined by the user to turn
Fig. 3. Infographic of IoE in power systems
some loads off automatically. All these controlling tasks will

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 The emersion of microgrids is accelerating in power
systems, especially office sites, universities, residential
communities, military sites, and industrial regions etc.
Microgrids can be designed to operate independently (isolated,
islanding mode, off-grid mode) or collaboratively (connected
to an upstream grid). If a microgrid is connected to the main
grid, the excess generation of intrinsic resources can be sold to
the upstream grid to increase the profit of microgrid. A
microgrid may be comprised of a set of distributed generation
(DG) sources such as gas-fired combustion turbine, diesel
generator, micro-turbines, reciprocating engines, biomass, and
waste-to-power units along with small-scale RESs such as
small-scale wind turbines and solar panels. Some of
abovementioned generating units can be used in a combined
heat and power (CHP) scheme to improve efficiency [38]. In
addition, small-scale storage units should also be used to store
the excess generation of small-scale RES when there is a
lower level of demand. Such small-scale distribution networks
usually integrate battery storage units but utilization of fuel
cell, micro-CAES, and flywheel units can be found in some
cases. Many hybrid schemes are proposed to investigate the
cooperative operation of microsources and storage facilities
which are present in the microgrid. In addition, some
researches have proposed the paradigm of interconnected
microgrids which mitigate the reliance on the main grid [39].
Two concerning issues of the current microgrids are power
quality and efficiency of the system. At the current time, the
microgrid’s operators conduct their own forecasts and
schedules. The internal control of microgrid’s components
will be managed by the microgrid’s operator. In this situation,
the operators of the main grid or the market operator or the
regional transmission organization have no monitoring and
control on microsources of the microgrid. From a system
operator point of view, a microgrid is regarded as a single load
and must be dealt with like an aggregator or retailer for power
exchange. Hence, due to the inevitable uncertainties and the
internal limitations of the microgrid, part of energy may be
curtailed.
By implementation of IoE infrastructure, the data
corresponded with all microsources can be shared with the
main grid’s operator, which is not done at present. This is a
massive amount of in-detail data which requires a large
burden to be analyzed. However, incorporation of the
elaborate instantaneous signals of microsources and internal
load patterns along with the evaluation of historical records of
microsources can provide a more comprehensive probabilistic
scheduling that it brings tangible benefits for the power
system. For example, more exploitation of RES, alleviation of
emission, prevention of incurring considerable costs
pertaining to the commitment of more expensive units can be
mentioned. In another word, the incorporation of IoE in
microgrids helps to mitigate the risk and manage the operation
of the whole system better enjoying the existing potentials of
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microgrids to have the more efficient operation of the
distributed capacities. In addition, IoT digital intelligence
helps to solve security issues concerned with the connection of
two microgrids to each other due to rapid fluctuations in
generation or consumption, which particularly impact
industrial consumers economically in case of outages or
brownouts. IoT can also provide better maneuverability for the
microgrid’s operator to model and control the microgrid, and
to perceive a better insight into components’ behaviors.
Modern analytical techniques can be employed by the operator
to analyze the components patterns.
Controllable generation
CHP Natural Controllable
Fuel cell Utility grid
gas load
Photovoltaic
Limited or non-controllable
Wind farms
Microgrid
IoE
generation Manager
Backup
generation
UPS
Energy storage
Thermal/ Electrical
Fig. 4. The deployment of IoE in microgrids
2) IoE and demand response
Before the last two decades, the demand model was
considered to be a random process which is governed only by
statistical laws. Thus, the power industry has developed very
sophisticated approaches to adapt generation to demand in
real-time. This lack of control on demand incurred high costs
because the grid dimension was designed for peak
transmission; large power plants should be constructed to
serve the demand for just a few hours within a year; a
considerable detriment was incurring due to the costs
associated with emission. However, more pervasiveness of
electricity markets and developments of the communications
networks, which are capable of controlling and monitoring
demand at the consumer level in real-time, have emerged the
idea of demand response programs (DRPs) [40]. Currently, the
world is experiencing a transition. The advent and ubiquitous
presence of the internet have facilitated the demand response
(DR) implementation to be more user-friendly and more
attractive for the consumers. The loads can be made aware of
electricity price at real-time using different IoT-based
technologies such as smart counters, AMIs, web servers, and
mobile networks or internet-based applications. The user can
manage its consumption by tracking the state of its internal
loads and can have remote control over them using IoE
technologies. The control over equipment in the residential or
industrial sections can be managed automatically using IoT
controller technologies. Hence, a proper reaction can be done
in the requested time by elastic loads.
 DRPs are segregated into time-based rate programs (TBR)
and incentive-based programs (IBP). TBR refers to the model
of electricity pricing which provokes a reaction by the
consumer due to instantaneous price. TBR has three kinds of
time of use program (TOU), real-time pricing (RTP), and
critical peak pricing (CPP). These programs incline the user to
have a sensitive reaction associated with the instantaneous
price of electricity [41]. IBP is classified into three categories
of voluntary programs (including direct load control (DLC)
and emergency demand response programs (EDRP)),
mandatory programs (including capacity market program
(CAP) and interruptible/curtailable (I/C) services), and market
clearing programs (including demand bidding/buyback (DB)
and ancillary services market (A/S)) [42].
Obviously, the execution of all these programs can be
facilitated enjoying IoE. The system operator will have more
elaborate control over a wider range of consumptions. Hence,
they can make smarter decisions. They can impose more
intelligent consumption reductionf or load shedding. In the
past, the entire feeder must be disconnected to impose load
shedding. Enjoying IoT technologies, the operator has more
options to reduce consumption. They can have control over
the small-scale loads and can choose to turn them off by type,
classification or category. Thus, the user will not be
unsupplied entirely. In addition, each individual load can be
connected to AMIs for receiving various data such as price to
manage the consumption of electrical devices automatically
using IoE infrastructure. The manufacturers of various kinds
of electrical equipment are inclined to equip their products
with IEDs and controlling boards capable of remote control or
automatic control with the ability to connect to internet-based
or cloud databases or AMIs. In addition, appropriate APIs can
enable the user or operator to manage and control the
consumptions and monitor the patterns visually.
It is evident that the DR notification mechanism requires a
reliable communicational system, and the way customers can
manage their usage by shifting or reducing electricity
consumption can be facilitated using IoT infrastructure. In
addition, the reduction or shift of consumption can be carried
out automatically using advanced controlling equipment with
the capability to connect to telecommunications networks.
3) IoE and plug-in electric vehicle integration
The technologies associated with plug-in electric vehicles
(PEV, or EV) are evolving rapidly. It is predicted that EVs
will have a profound implication on power systems operation
in the future decades. If purchasing price of EVs and the
technologies corresponded with the efficiency of EVs
improve, EVs will have more pervasiveness in modern smart
grids to large extent. Some kinds of EVs have the ability to
exchange power (injection or absorption of power) with the
grid. This feature is called vehicle to grid (V2G) capability.
EVs exchange power with the distribution grid through widely
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deployed parking lots throughout a city or residential EV
supply equipment (EVSE). Thus, an EV can be modeled either
as a simple load or as a prosumer, which favorably will be
charged at valley hours of the demand curve and may be
interested in delivering the power back to the grid at peaks to
earn a profit. The controversial issue is the modeling of large-
scale integration of EVs regard to their mobility and stochastic
behavior. They may charge their car at any time and may
deliver power to the grid whenever they want. Furthermore,
EVs have not a unique position and they may relocate from
one bus to another. Hence, the incorporation of V2Gs is a
huge source of uncertainty in power system modeling which
can compromise the security of the main grid, and this issue is
not addressed by researchers yet. In such a situation, IoT
infrastructure can provide better monitoring of EVs to conduct
better scheduling for the next hours. First, the approximated
amount of normal EVs and V2G-capable EVs must be
distinguished. Then the consumption pattern of each feeder or
each public parking lot must be recognized which helps the
operator to have a better prediction and estimation. Then
probabilistic forecasting approaches must be employed to
conduct scheduling. However, such scheduling is not
adequately accurate due to the massive uncertain parameters
in the model. IoT can definitely help to tackle this problem.
Each V2G must be equipped with sensors and AMI that are
capable to connect to a cloud network in the area of a city and
its close vicinity [43]. The data of all EVs present in the city
should be gathered instantaneously. The data will be
monitored and the proper forecasts for power consumption or
power delivery will be performed based on the individual
pattern of each EV using data mining techniques. In the case
of emergencies, the operator is capable to stop charging of
V2Gs or promote V2Gs for power delivery at a certain time.
Hence, the deployment of IoE in V2G modeling is
indispensable [44].
4) IoE and residential consumption management
Residential end-users have certain consumptions in their
houses. They usually tend to use off-peak power instead of
expensive peak electricity. But the off-peak period is late at
night when most consumers are asleep or inactive. Hence, IoE
infrastructure can help to facilitate the management of energy
in buildings [45]. Hence, the concepts of smart buildings and
smart homes are framed as a subcategory of smart grids in
demand-side [46]. At first, all end-users must be equipped
with advanced counters (or AMIs) to get aware of the
instantaneous price of electricity. The type of pricing system
can be uniform pricing, time-based rate (TBR) pricing, or real-
time pricing. In the recent decade, the manufacturers of
residential appliances are equipping their products by IEDs
with IoT connectivity capability to have real-time informatics
connection with AMIs. These devices can be programmed to
do some duties automatically, which brings economic
advantages for the owners. For example, a dishwasher is able
to start the machine when the price of electricity is cheaper or
will be cheaper. The concept of smart building monitors and
controls many items in a house automatically or through
remote control by the user using mobile applications or web-
based servers by using cloud data transferring [47]. Some of
the IoE usages in a smart building are the remote control of
energy electricity consumptions by electrical devices such as
TV, washing machine, dishwasher, refrigerator etc., the
control of HVAC system, the control of doors, the 24/7
monitoring of the house through security cameras, control of
lighting etc. as depicted in Fig. 5.
Fig. 5. The schematic of a smart building
IV. CONCLUSION
The revolutionary advances have been made in the area of
information and communications technology (ICT). In
addition, the configuration of power systems is changing
toward a carbon-free and more robust systems while more
exploitation of RES in grid-scale and more prevalence of
small-scale demand-side microsources are targeted.
Furthermore, objectives such as reliability improvement and
decarbonization for sustainable developments are drawn by
the energy expects for future power networks. The integration
of ICT along with the current trend of technological
development in energy section has emerged a new concept
known as the internet of energy (IoE) which is a kind of
application of internet of things (IoT) in smart power systems.
IoE is a pathway to materialize targeted objectives of future
networks. IoE can be described as modernization and
digitalization of various sectors of the power grid with the
ability to share information in the form of local or global
networks. The application of ICT in power systems will have
revolutionary impacts on the operation of power systems in
supply-side and demand-side. This matter improves the
flexibility of the grid and boosts the maneuverability of the
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operators. In addition, better observability and controllability
of all system components will be maintained for the operator.
The local control centers or the control center of the main grid
monitor the instantaneous state of components using IoT
infrastructures and the appropriate controlling commands will
be sent to corresponding sectors. Hence, it is hoped that the
implementation of the IoE scheme will bring tremendous
economic and environmental benefits for power systems
which will outweigh its required capital costs of IoE. All in
all, the employment of internet-based technologies in power
systems brings immense benefits for power systems in
different sectors and outlines a brilliant future for the
development of energy sector in terms of economic, social,
and environmental sustainability.
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