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Based on a large volume of relevant documents on smart grid, the paper summarized current developing situation of smart grid, including the definition and character description in Europe, America and China. It pointed out that because of different development environment and drive force, different countries' power grid enterprises and organizations comprehend the smart grid concept variously. The research and practical thoughts, methods and key points were quite different. Then integrated with Chinese conditions, the paper stated the power grid current development situation and challenges. Based on the power grid construction situation in China, the authors gave out a series of suggestions on how to construct the Chinese-style smart gird. The suggestions included establishing China's smart grid development strategy as soon as possible, enhancing the ultra-high voltage main power grid and its supporting equipment construction, devoting much effort to develop new resources and related technology, etc. As the initial stage of smart grid, there is much more work remains to be carried out in the future.