The economic and social effects of loss of electric service have significant impacts on both the EEP and EEU supplying electric energy for end users of electric service. A stable and reliable manner of electric power supply system serve customer loads without interruptions. Reliability assessment of 66/33 kV and 66/15 KV transformer throughout of three 33 KV and four 15KV outgoing feeders were presented in this thesis. Both 33 and 15 kV network was operated as radials networks and total capacity of 66/33 and 66/15 kV transformer is 31.5 MVA. Distribution reliability primarily relates to equipment outages and customer interruptions. There were problems of over loading, short circuit due to seedlings tries, improper allocated distribution transformers, less maintenance, limited protective devices in Dangila substation. Due to this, in the case study there were more interruption of frequency and durations was increased. Thus, interruptions were caused mainly by permeant short circuit (PSC) permanent earth fault (PEF), transient earth fault and short circuit. The overall base case Dangila substation SAIFI = 774.93, SAIDI =1231.48, CAIDI = 1.589, ASAI =85.96% and ASUI =14.04 % which was greater than the standard of Ethiopian Electric Agency (EEAs)/ SAIFI =20 and SAIDI= 25. Therefore, the reliability of this base case need to be further improved. The size of a single DG was 3.13 MW to improve the overall system at a time of interruption. Simulation were carried out using DigSilent software to analysis reliability. DGs placement was conducted on Selected and non-selected feeders and distance verses reliability of more outage feeder.so, one of best placement of DG was at feeder seven (D-07). The base case of D-07 was SAIFI =636, SAIDI=833, CAIDI =1.311, after DG placement at this end section was SAIFI =20.0868, SAIDI =25.109, CAIDI =1.25 and ASAI =99.71 % was improved.