This document discusses the application of fuzzy logic to optimal capacitor placement in distribution systems. It begins with definitions of fuzzy logic and fuzzy sets. It then describes the key components of a fuzzy logic system including fuzzification, fuzzy inference rules, and defuzzification. It proposes using power loss reduction index and bus voltage as input variables, and capacitor placement suitability index as the output variable, to determine the optimal locations and sizes of capacitors. The goal is to minimize power losses and maximize annual savings using fuzzy logic techniques.