This paper presents an approach for the detection and localisation of the power quality events associated with wind energy penetration into the distribution network. A standard IEEE 13 bus distribution network has been modified by adding wind and diesel generators for the case studies. The proposed test system is simulated in MATLAB/simulink environment. Voltage signals captured at nodes of the test system are used for power quality analysis. The harmonic detection has been carried out using Fast Fourier Transform and voltage sag, swell have been detected by voltage index calculated based on wavelet analysis. The unbalance in the system has been detected by the sequence components of voltage. The power quality disturbances associated with the events such as islanding, grid synchronization and outage of wind generators have been investigated. The detection of islanding, grid synchronization and outage has been proposed using sequence components of voltages measured. © 2015 IEEE.