Challenges of Smart Grid Technology Deployment in Developing Countries

In developing countries, electric grids are faced with issues such as rising demand for electricity, growth of renewable energy, increased losses, threats to the security of electricity infrastructure, and climate change. These are major challenges in traditional electric grids and increasingly highlight the need for transition to smart grids (SGs). Smart grids help rise to these challenges by utilizing communication and information technologies (ICTs) with the possibility of two-way power and information flow between consumers and generators. However, various political, economic, and technical challenges have prevented the rapid deployment of SGs in developing countries and Iran in particular. In this regard, by reviewing the literature and interviewing experts, 41 challenges on the way to deploy SGs with the framework of technological innovation system (TIS) in developing countries were extracted herein. Then, using interpretive-structural modeling (ISM), communication and the importance of the challenges regarding SG deployment in Iran were analyzed. The findings indicate that the following challenges related to functions such as resource mobilization (inadequate investment firms and venture capital and deficiency in public procurement) and market formation (low volume of foreign investment) are the most important challenges for the SG deployment in Iran. This chapter provides suggestions for policymakers and decision-makers to accelerate the SG deployment in Iran and developing countries in general.