Every conductor has resistance, so some of the supply voltage is spent pushing current down the run instead of arriving at the load. Too much of that loss shows up as dim lighting, nuisance tripping, overheating motors, and wasted energy, which is why the NEC recommends keeping the drop within 3% on a branch circuit and 5% on the combined feeder plus branch — a fine-print note to 210.19(A) and 215.2(A), a performance recommendation rather than a hard safety limit — while IEC 60364 commonly works to 4%.
The arithmetic differs by phase configuration. Single-phase current travels out and back, so the drop covers two conductor lengths: Vd = 2·I·L·R/1000. In a balanced three-phase system the returns cancel and the factor becomes √3: a 100 A load on 50 mm² copper (0.463 Ω/km) over a 60 m run at 400 V drops 1.732 × 100 × 60 × 0.463/1000 = 4.81 V, just 1.20%. For lagging loads the resistance-only figure understates the loss — the accurate form uses the impedance term R·cosφ + X·sinφ, with reactance mattering most on large conductors and long runs.
The remedies fall straight out of the formula: shorten the run, raise the system voltage, improve the power factor, or fatten the conductor — paralleling several conductors per phase divides the effective impedance proportionally. Resistance values come from the NEC Chapter 9 conductor tables, taken at about 75 °C, a common design temperature.