An electrical grid is an interconnected network for delivering electricity from suppliers to consumers. It consists of three main components: 1) power stations that produce electricity from combustible fuels (coal, natural gas, biomass) or non-combustible fuels (wind, solar, nuclear, hydro power); 2) transmission lines that carry electricity from power plants to demand centers; and 3) transformers that reduce voltage so distribution lines carry power for final delivery.
In the power industry, electrical grid is a term used for an electricity network which includes the following three distinct operations:
- Electricity generation - Generating plants are usually located near a source of water, and away from heavily populated areas. They are usually quite large to take advantage of the economies of scale. The electric power which is generated is stepped up to a higher voltage-at which it connects to the transmission network.
- Electric power transmission - The transmission network will move (wheel) the power long distances–often across state lines, and sometimes across international boundaries, until it reaches its wholesale customer (usually the company that owns the local distribution network).
- Electricity distribution - Upon arrival at the substation, the power will be stepped down in voltage—from a transmission level voltage to a distribution level voltage. As it exits the substation, it enters the distribution wiring. Finally, upon arrival at the service location, the power is stepped down again from the distribution voltage to the required service voltage(s).