In this paper, we propose a framework for coupling the communication network of a smart grid with the power distribution network in an effort to better utilize the scarce energy resources. We believe that an agile, robust and effective communication infrastructure, relying on a service-oriented network paradigm is essential for proper operation of a greener and smarter electricity grid. The communication and power components of the grid should not be studied in isolation and we suggest a model where the communication delays are integrated in an electricity market pricing model such that the power demand affects the allocation of communication resources and vice versa. Power demand could be monitored and predicted via smart meters that would allow a dynamic pricing scheme. This serves as a feedback mechanism towards the consumers which can then reduce their consumption or activate alternative sources of energy to alleviate the local distribution system.
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