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Ampacity is the rms current which a device can carry within specified temperature limitations in a specified environment dependent upon: a) temperature rating, b) power loss, c) heat dissipation.

The ampacity for a cable is thus based on physical and electrical properties of the material, the construction of the conductor, the insulation composition, ambient temperature, and environmental conditions adjacent to the cable. Having a large overall surface area may dissipate heat well if the environment can absorb the heat.

In a long run of cable different conditions govern, and installation regulations specify that the most severe condition along the run governs the cable's rating. Cables run in wet or oily locations may carry a lower temperature rating than in a dry installation. Special calculations are necessary for multiple circuits in proximity in adjacent raceways. When multiple cables are bundled together, each contributes heat to the bundle and diminishes the amount of cooling air that can flow past the individual cables. The overall ampacity of the insulated conductors in a bundle of more than 3 must be derated, whether in a raceway or cable. Usually the de-rating factor is tabulated in the wiring regulations.

Depending on the type of insulating material, common maximum allowable temperatures at the surface of the conductor are 60, 75, 90 degrees Celsius, with an ambient air temperature of 30C. 105C is allowed with ambient of 40C, for larger power cables, especially those operating at more than 2kV.

The allowed current in cables might be decreased (derated) when the cable is covered with fireproofing material.

Wires are heated by the Joule heating caused by the electric current flowing through them. Copper or aluminum wires could conduct a large amount of current before melting but long before the conductors melt, their insulation could be damaged by the heat.

For example, the National Electric Code, Table 310-16, specifies that up to three 8 AWG copper wires having a common insulating material (THWN) in a raceway, cable, or direct burial has an ampacity of 50A when the ambient air is 30C, the conductor surface temperature allowed to be 75C. A single insulated conductor in air has 70A.