Attempts to reduce electricity cost, together with improving the efficiency of distribution systems, have led power utilities to dealing with the problem of power loss minimisation. Although losses in the system can never be entirely eliminated, they can be controlled and minimised in several ways. Research conducted in the last few decades has proven that an inclusion of Distributed Resources (DR) into distribution systems considerably lowers the level of power losses. Moreover, the choice of DR is even more attractive since it provides not only benefits in power loss minimisation, but also a wide range of other advantages including environment, economic and technical issues. In this paper, the potential ability of DR in power loss reduction is discussed. A novel approach to determining a proper size and location of DR in order to achieve maximum loss reduction in distribution feeders is developed. A practical feeder of Aurora Energy, Tasmania is selected to demonstrate the effectiveness of the proposed method and the simulation results are reported.