In this paper, the performance limits of faults localization are investigated using synchrophasor data. The focus is on a non-trivial operating regime where the number of Phasor Measurement Unit (PMU) sensors available is insufficient to have full observability of the grid state. Proposed analysis uses the Kullback Leibler (KL) divergence between the distributions corresponding to different fault location hypotheses associated with the observation model. This analysis shows that the most likely locations are concentrated in clusters of buses more tightly connected to the actual fault site akin to graph communities. Consequently, a PMU placement strategy is derived that achieves a near-optimal resolution for localizing faults for a given number of sensors. The problem is also analyzed from the perspective of sampling a graph signal, and how the placement of the PMUs i.e. the spatial sampling pattern and the topological characteristic of the grid affect the ability to successfully localize faults. To highlight the superior performance of presented fault localization and placement algorithms, the proposed strategy is applied to a modified IEEE 34, IEEE-123 bus test cases and to data from a real distribution grid. Additionally, the detection of cyber-physical attacks is also examined where PMU data and relevant Supervisory Control and Data Acquisition (SCADA) network traffic information are compared to determine if a network breach has affected the integrity of the system information and/or operations.
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