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I took a look inside my panel today and saw a big green wire connected to the neutral bus bar. Why are these two bonded together? Why not just send the neutral back where it came from? Where does the neutral line go once it leaves my house? Are the neutral and ground also bonded at the electric meter?

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See this: diy.stackexchange.com/questions/1706/… – Cornelius Jul 12 '14 at 20:32
I drew up some diagrams showing the connection of earth and neutral bars for another question. This shows where the neutral goes after it leaves your house. See here: electronics.stackexchange.com/a/121026/28570 – Li-aung Yip Jul 13 '14 at 16:45
up vote 3 down vote accepted

According to the North American electrical code (US and Canada), Neutral and Safety Ground must be bonded at the service entrance (or main breaker panel). The green wilre will also be connected to Earth via a ground rod driven into the earth near the service entrance. Neutral will also be grounded at the power pole and distribution transformer.

All this grounding ensures that the AC wiring is kept near earth potential, and won't drift up to 12 KV due to a fault in the distribution transformer.

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