Electricity networks operators must operate their network with a high degree of efficiency and reliability. Presently the drivers for lower-carbon electricity generation technologies are high, and to accommodate such technologies (e.g. large-scale wind power), significant changes have to be made to the way that Transmission and Distribution (T&D) networks are designed and operated. The Smart Grid concept has been introduced to highlight alternative, automated technologies that may bring significant benefits to the T&D networks. This paper summarizes smart grid technologies within the T&D sector that in terms of technology readiness are superior to other technologies, and are expected to be deployed in the near future. This paper summarizes the drivers behind development of the smart grid, then by introducing some smart grid technologies, their potential applications and benefits are discussed. The engineering challenges which may prevent large scale deployment of smart grid technologies is discussed.