Understanding the “Grid”
The term grid itself is a bit confusing in that it typically conjures an image of a linear pattern, like the streets of Manhattan or a page of graphing paper. In fact, when people talk about the power grid, what they are actually referring to is a network. This network is made up of generation plants, transmission lines, and transformers -- which convert and distribute high-voltage power into homes.
It is also problematic because "grid" doesn’t really describe scale in any specific way. It can, of course, mean a single chain that goes from a power plant into an individuals home. It can also mean an entire country -- or continent’s -- power system.
The reality is that the single chain rarely exists anymore. In most places, power from a number of generation plants is carried via a series of transmission lines and transformers and adjusted -- often manually -- to deal with fluctuations in demand and capacity.
Managing this network in a more responsive and efficient way is the goal of the smart grid.