The term “Electrical Service” can be confusing for many electricians. What does it consist of? Why are there different sizes? Why do we have overhead vs underground services? Where does the service start/stop and where does the building power start?
Understanding the Basics
At its core, the electrical service is the point where power from the utility company enters a residence or building. Sometimes, installers build services remotely from the structure, placing them on a rack or pole. For example; while others attach directly to the building structure itself. When discussing electrical code we consider the service “starting” wherever the first means of disconnection is, to de-energize the entire premises wiring system. Code does not consider the meter itself part of the electrical service. Rather it is utility equipment the utility company uses to record and measure the power usage. So they can determine how much to charge for consumption. Per 2023 NEC 230.66(B) “Meter sockets shall not be considered service equipment but shall be listed and rated for the voltage and current rating of the service.“
In most cases, the electrical service is fed from a utility transformer, either pole-mounted or pad mounted on the ground. This devices is used to take an incoming higher distribution voltage and transform it down to a lower premises voltage. Such as 120/208V or 277/480V, for the building. The transformer has two sides: the primary side, connected to the power grid. And then the secondary side connected to the building. The design isolates both sides of the transformer from each other. And through electromagnetic induction influence one another at a (somewhat close) distance.
Different buildings require various sizes of services based on their unique electrical load. For instance, a typical house might only need a service rated from 125 to 200 Amps. While a large custom home may require an 400 Amp service. A commercial building might require a service that can handle 800 Amps. And an industrial facility with a lot of machinery could require thousands of Amps.
An important aspect of electrical services is grounding. Typically, the electrical service does not include an equipment grounding conductor from the utility transformer to the service. Rather we establish grounding for the premises at the point of utilization. This is where installers bond the service neutral to the earth. From the utility transformer, two or three ungrounded (hot) conductors, and in many cases a grounded (neutral) conductor, are brought down as “service-entrance conductors” to the building to feed power to the service. From the service disconnect a grounding electrode and grounding electrode conductor are run into the earth to establish the system’s neutral and grounds at the same potential as earth.

Single-Phase vs Three-Phase
Power can be delivered to a property in either single-phase or three-phase configurations, each with its own advantages and applications:
Single-Phase Power
Residential and small commercial settings commonly use single-phase power. It consists of one large loop, or circuit from a transformer to the building, through the building circuits, and back out to the transformer. This formation of a loop, or “phase” is often thought of as two wires, a black and red forming a 240 Volt circuit; however these are not two distinct wires, they’re just different polarities of the same one loop of wire when zoomed out at a larger scale. This is why they call it “single” phase.
The voltage between the two opposing sides of the single phase is, nominally, 240 Volts. Nearly all single-phase services have a neutral, which is tapped exactly half-way between the two ends of the transformer’s secondary winding; which gives the neutral half the voltage between either end of the winding; where the red and black conductors are tapped. This results in the neutral wire having a potential of 120 Volts, nominal, between it and either hot conductor. Outside of the U.S. many systems do not have a neutral and operate closer to 230 Volts. Which is close enough to 240 Volts that most equipment operates fine on either system.
Single-phase systems are simpler and less expensive to install and maintain compared to three-phase systems. However, it is a less efficient system as power delivery in a single-phase system fluctuates, leading to potential voltage drops, especially under heavy load. Most often single-phase is for homes, small businesses, and light loads like lighting, heating, and small appliances. Once equipment starts to demand heavier power use, three-phase systems become a more popular choice.
Three-Phase Power
The use of three-phase power is predominantly in industrial and commercial settings. It consists of three phases (circuits, loops) and can either have a grounded version which comes with a neutral, or an ungrounded version which is simply 3 hot conductors. With three-phase systems there are 3 conductor loops from the utility company to the transformer at the utility pole at the end of the property. A three-phase power pole will have 3 canisters mounted on top, each having their own internal primary and secondary winding. These canisters can be wired together in a Delta (Δ) configuration, or in a Wye (Y) or what is sometimes referred to as a “Star” configuration.

Depending on the wiring configuration of the transformer, Wye or Delta, the voltages measured between any two phase conductors is most-commonly 208V, 240V, or 480V, nominal. We keep saying “nominal” because this represents a “target” voltage, or voltage range. In reality voltage will vary slightly from building to building across the entire utility network. In both single-, and three-phase applications it’s not uncommon to see 238V or 245V when actually measuring voltage. So 240V nominal, just means a “relatively 240V” service.
Three-phase provides a more stable and consistent power delivery, which is beneficial for running large motors and heavy machinery. Rather than power constantly pulsing on and off 120 times per second (two polarity changes per second on a 60Hz system) with single phase, three-phase never has an “off” state. This means these systems are more efficient for transmitting more stable and consistent electrical power over long distances and for high power loads. In three-phase systems, you can balance an entire load across the three phases. Which reduces the burden on each individual wire and improving overall system reliability.
Overhead vs Underground
Overhead and underground services are available, and you will see both used frequently. While newer installations will often put the service underground, the older neighborhoods typically use overhead. Aesthetically, it is much more pleasing to the eye not to have to see the overhead wires and poles strung across streets and yards. This is why in a lot of modern wealthy neighborhoods there are not many overhead services.

The size of the service will depend entirely on what you intend on providing power to, or have the potential to provide power to via expansion. In residential applications, it is common for the electrician to decide what the service will look like, and have to calculate its size. In commercial and industrial settings, engineers calculate the services and provide exact details on how to build and function the service. A standard residential overhead service is a relatively small service, and takes up very little space on the side of the structure. A 1200 Amp 3-phase commercial service with several tenant spaces, however, may take up a 20 foot section of a wall.
Another thing which is commonly misunderstood is the rating of the service. For example, a 200A service does not mean the service panel is using 200A. It means the max capacity of loads all turned on and being used at the same time is 200A and it is normally the internal busbars of the service panel, as well as the main breaker attached to them which limit the panel’s size.
Some people try to add up the numbers on breakers, and realize each 20A breaker added up will yield more than 200A. But not every circuit is actually using 20A, so this is a useless task. A residential 200A service may only be utilizing 40A at any given time; and that’s with lighting, computers, TV’s, and a dryer all running at the same time. So the current reading on the panel’s conductors will vary greatly depending on the use at any given time. In fact, most homes with 200A services will rarely use even half of that 200A. We more often install 200A services because the materials are affordable and it provides extra capacity for adding more loads down the line, avoiding the need to rebuild the service.
Conclusion
Understanding electrical services is essential for ensuring the safe and efficient delivery of power from utility companies to buildings. The electrical service starts at the point where utility power enters a building, typically at the first disconnecting means ahead of the wiring system. This service can be configured as single-phase, commonly used in residential and small commercial settings, or three-phase. Which is more stable and efficient for industrial and large commercial applications. Grounding, achieved at the service entrance, is crucial for safety, providing a path for fault currents. Services can be installed overhead or underground, with underground installations becoming more common for aesthetic and practical reasons. The size of the service depends on the building’s power requirements. Understanding these components helps ensure compliance with regulations and reliable operation of electrical systems.