The access of massive terminal devices at the perception layer poses security threat to the power Internet of Things (IOT) of the State Grid Corporation. Due to lack of computing resources, the IOT perception layer terminal devices cannot embed the security chips. The lightweight authentication technologies are urgently needed to be developed to protect the authentication security of the IOT perception layer terminal devices. This paper proposes a lightweight identity authentication system based on the SM2 co-signature algorithm, which can be applied to the identity authentication of the IOT perception layer terminal devices. This system is implemented in software and characterized by low cost and strong compatibility, and most importantly, it can strengthen the identity authentication security of the power IOT which security protection capability will be improved consequently.