Electricity is an essential requirement for all facets of our life. It has been recognized as a basic human need and it is critical infrastructure on which the socio economic development of a country depends. With ever growing population, improvement in the living standard of the humanity, industrialization of the developing countries, the global demand for energy is expected to increase rather significantly in the near future. Today, the challenge of power sector is to match the ever increasing demand for power supply through newer environment friendly power projects with minimal transmission and distribution losses Even though globally the power generating capacity is increasing steadily, the growth in demand is exceeding the generation capacity and as a result of this many countries are facing acute shortage in peak and energy demand. Further, people in large number of village have no access to electricity. The electricity supply is not even sufficient for those who have been connected. The end users of electricity like household, farmers, commercial establishment and industries are confronted with frequent power cuts, both scheduled and un scheduled power cuts, erratic voltage and low or high supply frequency have added to the ‘power woes’ of the consumer Transmission and distribution losses have been concern for the developing countries, electricity sector since these have been very high when compared with developed countries. The present T&D losses including unaccounted energy are about 30% and there is a need to reduce these losses through efficient management and the best operation and maintenance practice of the transmission and distribution system so that more energy is made available to final consumer at reduced cost. Distribution generation(DG) is attracting increasing interest and policy attention. There are five major factors behind this trend: electricity market liberalization, developments in DG technology, constraints on the construction of new transmission lines, increased customer demand for highly reliable and quality electrical power, and concerns about climate change. DG have also become popular because they reduce the distribution loss substantially which is a major component of T&D losses and it will also improve voltage of the distribution network. The optimal allocation of DG units in power system has been a major challenge to distribution system planners as well as researches in the field. The reason for this is that DG affects the power flow and voltages conditions in the distribution system, contrary to its traditional unidirectional nature in radial configuration. Distributed Generation (DG) offers various techno-economical benefits when integrated in distribution system. Those benefits are always depends on the placement and sizing of DG. To maximise the benefits it is necessary to find optimal allocation of DG in distribution system. Optimal allocation of DG is a very important factor in planning & operation of distribution system. In present work a simple and efficient technique to implement DG at optimal is suggested. This technique has been applied to ieee 33 bus system, there is a remarkable improvement in voltage profile as well as reduction of losses in the system. The minimum voltage before implementing DG was 0.9038 pu, after DG implementation it improves to 1.0281 pu for DG of 1.5 MVA at 0.9 pf lag and 0.9713 pu for DG of 1.0 MVA at unity pf. Further, initially the system was having active and reactive power of 0.0021 pu and 0.0014 pu and subsequent to DG implementation the active and reactive power losses have come down to 0.0011 pu and and 0.0008 pu for DG of 1.5 MVA at 0.9 pf lag, and 0.0014 pu and 0.0009 pu for DG of 1.0 MVA at unity pf.
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