The penetration is the ratio of the capacity of the generators to the minimum load demand on the feeder.
Regarding to operation conceptions, concerning are minor whenever just a few small distributed generator units are installed on a distribution feeder and the penetration, in terms of the ratio of the capacity of the generators to the minimum load demand on the feeder, is very small (typically less than 10%).
This scenario is already commonplace in the U.S. and Canada on some rural distribution feeders where small wind and PV systems are in operation at widely-spaced farms and ranches. DG operational concerns are expected to move to the forefront on highly-loaded urban feeders, where the scenario of many distributed generators (high density) and much higher penetration is expected to become the norm.
Regarding to protection conceptions, many utility guidelines were developed with the expectation that few interconnected generators would be installed on a given feeder and that the penetration would be very small. Therefore, it was assumed that there would be no appreciable effect on relays and breakers designed and set up for current flow in one direction only, and also no effect on the overall stability of the feeder. Furthermore, where penetration was small it was assumed that, should the feeder be isolated from the network for any reason, the distributed resources could not, under any circumstance, continue to supply the load, the voltage would collapse, and the distributed generators would shut down automatically (on an under voltage trip).