The electricity industry is now at the verge of a new era. An era that promises, through the evolution of the existing electrical grids to Smart Grids, more efficient and effective power management, better reliability, reduced production costs and more environmentally friendly energy generation. Numerous initiatives across the globe, led by both industry and academia, reflect the mounting interest around the enormous benefits but also the great risks introduced by this evolution. This paper focuses on issues related to the security of the Smart Grid and the Smart Home, which we present as an integral part of the Smart Grid. Based on several scenarios we aim to present some of the most representative threats to the Smart Home / Smart Grid environment. The threats detected are categorized according to specific security goals set for the Smart Home/Smart Grid environment and their impact on the overall system security is evaluated. A review of contemporary literature is then conducted with the aim of presenting promising security countermeasures with respect to the identified specific security goals for each presented scenario. An effort to shed light on open issues and future research directions concludes the paper.
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