The electric power system with its generation, as well as its transmission and distribution networks, is one of the most complex technical systems that humanity has created. A special concern pertains to the distribution networks on which most failures occur. Improved reliability can be obtained by increased investments, reinvestments and maintenance. The goal of this study is to examine the impact of components failure on distribution reliability. The paper describes a fault restoration sequence and duration in a distribution system and interruptions frequency and duration for different components and a development procedure for simulation after a fault and calculating associated time-varying failure rates and reliability indices and customers’ outage costs. The approach minimizes the costs of allocation and energy not supplied, under reliability constraints. The simulation is based on genetic algorithm concept. Case studies with a several network configurations and real-world scenarios were used to evaluate the methodology.