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Active management of complex distribution networks with distributed generation requires state estimation. As complete supervisory control and data acquisition systems are seldom available on 11-kV or lower voltage distribution networks, real-time measurements at remote points on 11-kV distribution networks are expensive. Therefore, the economical selection of a communication system for active management of distribution networks with distributed generation becomes an important issue. This paper presents the investigations into a leased communication system made of public-switched communication network channels for a distribution network state estimation application. It analyzes the effects of a different number of primary channels for real-time measurements on the distribution network state estimation accuracy. The leased communication system availability performance has also been analyzed and used to identify a number of reserve channels required to improve the leased system availability. The overall cost for improving the leased communication system availability has been calculated and compared with both a fiber-optic communication system and a power-line carrier communication system. The results show that the leased communication system is able to provide the lowest overall cost performance for the distribution network state estimation application.