The main reasons for installation of power quality meters in distribution transformer substations are power quality monitoring and global evolution of electrical network towards the smart grid'. In case that all measurements from the meters are properly synchronised and centralised, new possibilities of control or evaluation of the network are enabled. This contribution proposes the possibility for an earth fault localisation with the aid of synchronised data recorded on the low-voltage side of the medium voltage/low voltage transformers in compensated neutral distribution networks which are equipped with auxiliary resistor for short-time increasing of the active part of the fault current. The described method uses voltage sags evoked by connecting of the auxiliary resistor for locating the faulty section. The proposed method is tested with the help of numerical model which presents a part of the distribution network.