Network Planning and Fault Location, Isolation and Supply Restoration (FLISR) are important functions of power distribution automation systems. We model these functions as a combinatorial optimization graph problem called the Capacitated Spanning Forest Problem (CSF), defined as the problem of creating a spanning forest with a capacity constraint on each tree bounding its total weight. We present an algorithm based on a Hill Climbing heuristic for the solution of CSF that can be used to solve network planning and supply restoration scenarios on large graphs representing smart grids.