The problem of capacitor allocation in Electric Distribution Systems involves maximizing energy and peak power loss reductions by means of capacitor installations. This paper presents a novel approach using approximate reasoning to determine system candidate nodes in a distribution system for capacitor placement. The solution methodology has two parts: in part one the loss sensitivity factors are used to select the candidate locations for the capacitor placement and in part two the Particle Swarm Optimization Technique is used to identify the sizes of the capacitor for minimizing the energy loss cost and capacitor cost. The proposed method is applied to 15-bus and 33-bus radial distribution system.
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