A substation that has a step-up transformer increases the voltage whilst decreasing the current, while a step-down transformer decreases the voltage while increasing the current for domestic and commercial distribution. The word substation comes from the days before the distribution system became a grid. The first substations were connected to only one power station where the generator was housed, and were subsidiaries of that power station.

Substations generally contain one or more transformers, and have switching, protection and control equipment. In a large substation circuit breakers are used to interrupt any short-circuits or overload currents that may occur on the network. Smaller distribution stations may use Autoreclosers or even fuses for protection of branch circuits. Substations do not (usually) have generators, although a power plant may have a substation nearby. A typical substation will contain line termination structures, high-voltage switchgear, one or more power transformers, low voltage switchgear, surge protection, controls, and metering. Other devices such as power factor correction capacitors and voltage regulators may also be located at a substation.

Substations may be on the surface in fenced enclosures, underground, or located in special-purpose buildings. Substations located within the buildings they serve are particularly a feature of high-rise buildings. Indoor substations are usually found in urban areas to reduce the noise from the transformers, and for reasons of appearance.

Where a substation has a fence, it must be properly grounded (UK: earthed) to protect people from high voltages that may occur during a fault in the transmission system.

Transmission substation

A transmission substation is one whose main purpose is to connect together various transmission lines.

The simplest case is where all transmission lines have the same voltage. In such cases, the substation contains high-voltage switches that allow lines to be connected together or isolated for maintenance.

Transmission substations can range from simple to complex. A small 'switching station' may be little more than a bus plus some circuit breakers. The largest substations can cover a large area (several acres/hectares) with multiple voltage levels and a large amount of protection and control equipment.

Distribution substation
A distribution substation in Scarborough, Ontario, Canada disguised as a house, complete with a driveway, front walk and a mown lawn and shrubs in the front yard. A warning notice can be clearly seen on the 'front door'.
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A distribution substation in Scarborough, Ontario, Canada disguised as a house, complete with a driveway, front walk and a mown lawn and shrubs in the front yard. A warning notice can be clearly seen on the 'front door'.

A distribution substation is one whose main purpose is to transfer power from the transmission system to the distribution system of some area. It is uneconomical to directly connect electricity consumers to the main transmission network (unless they use large amounts of energy); so the distribution station reduces volt