A house has far more connected load than it ever draws at once, and the Code's calculation methods quantify that.
Two methods
The standard method works through each category of load with its own demand factors. Longer, more granular, and it can give a lower answer for some houses.
The optional method is a simpler procedure available for a single dwelling served by one 120/240 V set of service conductors. It is what is normally used, and it is what follows.
Either is acceptable, and where the optional method produces a number that forces an upgrade, running the standard method is sometimes worth doing before accepting it.
The optional method, step by step
General lighting and receptacles: a volt-amp allowance per square foot of floor area, calculated from the outside dimensions of the conditioned space, excluding garages and unfinished areas.
Small appliance branch circuits: a fixed allowance for each of the required kitchen circuits, minimum two.
Laundry circuit: a fixed allowance.
Fixed appliances at nameplate: range or cooktop and oven, water heater, dryer, dishwasher, disposal, and anything else permanently connected.
Sum the above, then apply the demand factor: the first 10 kVA at 100% and the remainder at 40%.
Add the heating or air conditioning load, whichever is larger, at its own specified percentage. They are not added together, because a house does not heat and cool simultaneously.
Divide by 240 to get amps.
What the answer typically looks like
A moderately sized house with gas heat, a gas water heater and a gas range calculates far below 100 amps.
The same house all-electric — resistance heat, electric range, electric water heater, electric dryer, air conditioning — can approach or exceed it.
That difference is the whole reason electrification is driving service upgrades, and it is why the fuel mix matters more than the square footage.
The parts people get wrong
Using connected load instead of calculated load. Adding up every breaker gives a number two or three times the real answer, and it is the most common amateur error.
Adding heating and cooling together.
Using the appliance's breaker size instead of its nameplate. A range on a 50 amp breaker does not have a 12 kVA nameplate.
Forgetting the demand factor on the portion above 10 kVA.
Omitting a load entirely — a hot tub, a well pump, a workshop subpanel.
Where it is required
For a permit on a service upgrade, a panel replacement, or the addition of a significant load such as an EV charger or a heat pump.
Also, sensibly, before deciding whether any of those are necessary.
Continuous loads
A load operating for three hours or more continuously — EV charging is the common residential case — is calculated at 125% of its rating.
That is why a 48 amp charger requires a 60 amp circuit, and why it consumes 60 amps of headroom in the service calculation rather than 48.
Energy management
Where an energy management system controls loads so they cannot operate simultaneously, the Code permits the calculation to reflect that.
This is the mechanism behind load management as an alternative to a service upgrade, and it has to appear in the calculation to be accepted by the inspector.
Getting one
Any licensed electrician can produce it from the square footage and a list of appliances. It takes well under an hour.
Ask for it in writing with each load itemised, because that is the document that justifies — or removes the need for — everything else on the quote.