The paper presents a novel method for power loss allocation of power systems to demands. This loss allocation technique is based on the contribution of individual demands to the branch power loss of power grids. Results of power flow analysis, precise power system modelling and superposition theorem are deployed in this proposed method. The advantage of the method described in the paper is that it is accurate and ensures fairness among network users. In addition, this allocation method is simple and can be effectively exploited to both meshed and radial electrical networks. A six-node meshed transmission system and an IEEE 33-bus radial distribution grid are utilized to implement power loss allocation based on the proposed method. The influence of demands' power factor on the power loss allocated is also taken into account using the six-node meshed transmission network.