This Small Business Innovation Research (SBIR) Phase II project develops devices and systems to conduct two-way data communication using the electrical power distribution grid as the communications medium. The Phase I research provided information needed to optimize the devices, systems, and methods used, but also raised additional questions that need to be researched during Phase II. This effort includes the development of specialized high-order modulation techniques, filters and shields to allow the equipment to operate in a high-voltage environment, and specialized low-overhead communication protocols to accommodate the constraints imposed by the communications medium. If successful, an application platform for grid applications and a management model for distributed communications and intelligence will be developed. Typically, these needs are being addressed by overlaying a digital network of some sort over the power distribution network. Smart Grid initiatives in development today are complicated by the fact that no one digital communication technology is adapted to all the places and environments in which the Smart Grid must operate. The grid itself is always present wherever Smart Grid intelligence is needed, making on-grid communications potentially the simplest and most cost-effective medium for enabling Smart Grid communications.<br/><br/>Power Tagging Technology encourages a fundamentally different approach to Smart Grid implementation. Early efforts at using technology for demand management by engaging consumers have favored consumers at the high end of the economic scale, ones who live in newer subdivisions, and have the funds, skills, and interest to invest in personal energy management technology. Rural and inner city consumers benefit much less if at all from these programs. However, Power Tagging Technology has the potential to benefit all types of consumers equally through applications like high-resolution Conservation Voltage Regulation that reduces energy consumption and costs for wide-range of consumers. Power Tagging Technology is not only a communications mechanism, but it is inherently also a mechanism for monitoring the grid and inferring information about the electrical distribution infrastructure that is not readily available today. If successfully deployed, Power Tagging Technology has the potential for enabling whole new fields of research and development in Power Engineering and Grid Security.