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Electrical power grid is undergoing a major renovation, to meet the power quality and power availability demands of the 21st century. The new power grid, which is also called as the smart grid, aims to integrate the recent technological advancements in the Information and Communication Technology (ICT) field to the power engineering field. The present smart grid implementations focus on smart meter based utility-to-meter and utility-to-customer communications. Although these features provide significant improvements on the customer management side, in the following decades, grid management will be one of the major ICT-dominant fields. Recently, adoption of Wireless Sensor Networks (WSN) for the power grid is gaining wide attention from the industry and the academia. Scalar sensor measurements bring valuable insights, however they can provide limited set of information. In the next generation power grid, limited-sensing, Supervisory Control and Data Acquisition (SCADA) based, centrally controlled operational architecture will be replaced with wireless connected, low-cost, multimedia sensors combined with distributed decision-making and acting systems, working in coordination with a supervisory software tool. In this paper, we discuss the potential applications and the challenges of employing wireless multimedia sensor and actor network (WMSAN) for the smart grid.