The main focus of this thesis is to test a model that compares the present grid and a Smart Grid system. The thesis discusses the major issues faced by our electricity infrastructure and the possible solutions offered by the Smart Grid. Present grid limitations based on operational, technological, planning, and policy issues are covered. The thesis initially focuses on the limitations of our present grid, and describes severe limitations of our current grid during blackouts. The thesis outlines possible solutions for these problems offered by the concept of the Smart Grid, whose technology and features are described in detail. The thesis details Smart Grid technologies for power generation and the latest electronic devices available to aid the current aging power grid. Further, this thesis offers an analysis that compares the ‘present grid’ to a particular ‘Smart Grid’ configuration consisting of a Combined-Heat & Power (CHP) plant, a Photovoltaic system, and a Demand Response with real-time pricing. The analysis reveals the economic and operational benefit of the Smart Grid system under consideration.