Increasing the energy efficiency of an Internet of Things (IoT) system is a major challenge for its successful implementation. To reduce the computation and storage burden and enhance the efficiency of traditional IoT, an energy-efficient diffusion-based algorithm for state estimation in multi-agent networks is proposed in this paper. In the proposed algorithm (referred to as reduced-link diffusion Kalman filter (RL-diffKF)) the nodes (agents) can communicate only with a fraction of their neighbors and each node runs a local Kalman filter to estimate the state of a linear dynamic system. This algorithm results in a significant reduction in communication cost during both adaptation and aggregation processes albeit at the expense of possible degradation in the network performance. To justify the stability and convergence of the RL- diffKF algorithm, an indepth analysis of the performance is reported. We also consider the problem of optimal selection of combination weights and use the idea of minimum variance estimation to analytically derive the adaptive combiners. The theoretical findings are verified through numerical simulations.
