At present, the communication between dispatching and substation is mainly protected by the power vertical encryption authentication device. The power vertical encryption authentication device at both ends of the dispatching and substation can protect the confidentiality and integrity of data transmission at both ends. However, the communication protocol IEC 60870-5-104 (IEC104) between dispatching and substation does not have a corresponding security mechanism. The protocol data is easy to be forged, tampered, replayed and stolen before the encryption device of the dispatch and after the encryption device of the substation, which poses certain security risks. Therefore, this paper extends the protocol security domain on the basis of IEC 104 protocol, and solves the problem of communication security between dispatch and substation from the protocol level. The identity-based cryptographic algorithm SM9 provides algorithmic support to achieve this goal. According to the characteristics of the algorithm and the protocol, the security of the protocol can be realized by a little extension of the protocol in this paper. The highlights of this paper are as followes: 1) based on the identity-based cryptographic algorithm the security communication between dispatching and substation is achieved, which is fundamentally different from the digital certificate based security communication in other documents, without certificate management and other complicated matters; 2) the end-to-end security authentication of the communication between the dispatching master station and the substation is achieved; 3) the security hidden dangers of the protocol are solved through the identity-based cryptographic algorithm, and the two-way identity authentication between the dispatching and the substation and the confidentiality, integrity and non-repudiation of the communication data are realized.