The applications of Distributed Generation (DG) in a smart distribution grid environment are widely employed especially for power balancing and supporting demand responses. Using these applications can have both positive and negative impacts on the distribution system. The sizing and location of their installations are the issues that should be taken into consideration to gain the maximum benefit from them when considering the economic aspects. This paper presents an application of the Bat Algorithm (BA) for the optimal sizing and siting of DG in a smart distribution power system in order to maximize the Benefit to Cost Ratio (BCR), subjected to system constraints including real and reactive power generation, line and transformer loading, voltage profile, energy losses, fault level as well as DG operating limits. To demonstrate the effectiveness of the proposed methodology and the impact of considering economic issues on DG placement, a simplify 9-bus radial distribution system of the Provincial Electricity Authority of Thailand (PEA) is selected for the computer simulation to explore the benefit of the optimal DG placement and the performance of the proposed approach.