Due to the challenge of climate and energy crisis

renewable energy generation including solar generation has experienced significant growth. Increasingly high penetration level of photovoltaic (PV) generation arises in smart grid. Solar power is intermittent and variable

as the solar source at the ground level is highly dependent on cloud cover variability

atmospheric aerosol levels

and other atmosphere parameters. The inherent variability of large-scale solar generation introduces significant challenges to smart grid energy management. Accurate forecasting of solar power/irradiance is critical to secure economic operation of the smart grid. This paper provides a comprehensive review of the theoretical forecasting methodologies for both solar resource and PV power. Applications of solar forecasting in energy management of smart grid are also investigated in detail.