One of the major attributes of the Smart home automation and energy management systems integrate IOT and renewable energy resources at the consumption premises. With the advancement of Automation technology, today‟s world prefers Automatic systems over manual systems. This paper presents the design, implementation, and testing of an embedded system using Arduino that integrates solar energy resources and energy management into a smart home incorporated with IOT. The proposed system provides and manages a smart home energy requirement by installing renewable energy and scheduling the power flow during peak and off-peak period. IOT (Internet of things) is the latest and emerging internet technology. Internet of things is a growing network of the everyday object-from industrial machine to consumer goods that can share the sensors information to the Automation system using WIFI communication. IoT is a system that uses computers or mobile devices to control all home functions and features automatically through the internet. In addition to that, a two-ways is developed to enable the homeowner and the utility provider to better optimization of the energy flow and the consumption efficiency. A prototype for the proposed system was designed, implemented and tested using a controlled load bank to simulate a scaled random real house consumption behavior.