Voltage drops occur when electricity travels over long lengths of wire. When installing a new circuit, especially one that runs a great distance, such as a line powering a shed or a barn, it is critical to know how much voltage is lost before it reaches your electrical devices. Failure to account for this drop can lead to poor electrical performance or reduced equipment life. The National Electrical Code (NEC) recommends wiring to avoid a voltage drop of more than 3 per cent for branch circuits and 5 per cent overall. Thicker wires can reduce voltage drop by allowing freer flow of the current.

Measure the length the wire must run. The NEC uses feet in their calculations, so keep your measurement in feet.

Determine the current running through the wire. Most modern American homes are connected to at least 100 amps, though older ones can be connected at 60 amps. The amperage service to your home should be marked on your main breaker.

Determine the thickness and material of the wire, and look up its resistivity constant. Electrical wires are usually copper or aluminium. The resistivity constants for each thickness and material can be found in chapter 9 table 8 of the NEC handbook.

Substitute the values into the equation VD = (2_L_R*I)/1000, where VD is the voltage drop, L is the length of the wire, R is the resistivity constant, and I is the current. Resistivity times length gives the resistance of the wire. Ohm's Law states that this resistance, multiplied by the current, yields voltage. Voltage drops usually are calculated per 1,000 feet, so the equation is divided by 1,000. This equation is for single-phase systems running from a pole-top transformer to your home only; a three-phase system, like long-distance high voltage transmission lines, requires a multiplier of 0.866.

Divide the voltage drop by the incoming voltage. For example, a 300ft. length of 4 gauge copper wire running a 60-amp current at 120/240 volts would have a voltage drop of (2_300_0.308*60)/1000 = 11.088 volts. Dividing 11.088 by 240 volts gives us 0.0462, or a 4.62 per cent voltage drop.