Abstract This paper presents an efficient algorithm to solve the reconfiguration problem by a switching operation to reduce the power loss of distribution systems. By utilizing the proposed heuristic rules and performance index PI which represent the loss reduction capability of the switching operation, a better network configuration is obtained. the PI ranking algorithm based on the linearized load flow model is applied to evaluate the PI reduction for each feasible switching operation and the PI ranking algorithm is then used to find the switching operation to be executed to reach the minimum system loss. A two-stage searching approach to the switching operation is proposed in this paper. The evaluation function of each tie switch is estimated and a depth-first search is used to find all possible switching operations. A performance index is then used to evaluate the loss-reduction capability of each feasible switching candidate. Two practical distribution systems of Taiwan Power Company (Taipower) have been selected for computer simulation to demonstrate the effectiveness of the proposed method.