Abstract: Due to the operation cost of communication system was seriously affected by both energy efficiency and error cost of demand response of wireless communication, a ultra-dense network structure-based wireless communication network, by which the management efficiency of smart grid demand response could be lifted meanwhile the operation cost of the system could be reduced, was proposed. Firstly, a central base station with large-scale antennas was utilized to ensure the communication stability of smart grid demand response. Secondly, by means of low precision analog to digital conversions/digital to analog conversions (abbr. ADCs/DACs) the energy efficiency of communication system was improved, at the same time the full-duplex working mode was adopted to further reduce the communication time delay. Simulation result show that under the premise of ensuring the cost of demand response error the energy efficiency of communication network can be effectively improved by low precision ADCs/DACs to reduce the operation cost of communication network.