This study presents a new approach in application of distance relay in distribution system. During the heavy load conditions, the load encroachment of impedance into the distance relay protection zones is a well-known reason for distance relay mal-operation. Therefore, all the modern digital distance relays are equipped with the load encroachment scheme. This study proposes the idea of using the load encroachment scheme of distance relay for monitoring purpose in the presence of renewable energy resources (RES) integration. Furthermore, it will be presented that based on the defined monitoring zones some alarms can be defined. The OpenDSS and Matlab software are used to test the effectiveness of the method with the IEEE 8500 node test feeder. The proposed method is tested with the unbalanced distribution system feeder loading and distributed model of solar generations. The dynamic performance of the proposed method is studied for on-line power factor monitoring of the feeder with the sun irradiation dynamic. The results show the necessity of power factor monitoring in the distribution system with RES integration. In addition, the simplicity of the proposed method allows its easy application in the digital distance relay.