Voltage drop is the volts lost to resistance in the cable. For copper DC at 75 °C (NEC Chapter 9 Table 8), VD = (2 × 12.9 × I × L) / CM, where L is one-way feet and the 2 covers the round-trip conductor. Percent drop = VD ÷ system volts. A 3% budget is a performance target so inverters and LED drivers do not brown out. Ampacity (how hot the insulation gets) is a separate limit — a cable can meet 3% drop and still be too thin to carry the current safely.