In this paper, we describe the design decisions, the implementation caveats, and the challenges faced while deploying a special-purpose wireless sensor network (WSN) at a domestic building that is part of a smart grid test environment. The sensor network is designed to collect high-quality data of the building's in- and outdoor climate, heating system, and energy consumption. This rich sensor data is analyzed in order to characterize the building's potential to act as a flexible energy consumer in a smart grid framework. In addition to the functional challenges, a continuous, low-power operation over extended periods as well as a plug&play, non-intrusive installation are required. Moreover, restrictions on the hardware costs and the development-to-deployment time had to be considered. Our simulation-driven application development and our highly modular design proved to be essential in meeting these challenges. This approach and its application to a real-world installation represent the key contributions of this work. © 2013 IEEE.