It is the amount of power available that determines how many homes can be supplied. And the answer is complicated, because it is necessary to take what is termed the 'after diversity, maximum demand' (ADMD) of the potential load in order to determine how many homes can be supplied. ADMD takes into account that no single property operates at maximum load on a permanent basis, and when one home owner is at home, several others are at work, etc., so the more properties there are, the lower the actual load will be compared with the theoretical maximum load.

In the very simplest case, with a large number of properties, a figure of just 3 kW per property might be appropriate but, where heavy permanent loads, such as electric heating or air conditioning are used, determining the ADMD is far more complicated because these permanent loads must be taken into account.

As already explained, ADMD assumes that not all properties are utlilising their maximum demand at the same time, so an ADMD might appear to be surprisingly low. So, as an example, let's assume an ADMD of, say, 5 kW, would mean that one megawatt could supply 200 properties.

ADMD figures are important, because they help designers determine what size transformers are needed to supply new developments. The actual load can them be monitored using thermal demand indicators attached to the transformer's secondary conductors and, in practise, these usually indicate that the theoretical ADMD figures, as low as they seem, are surprisingly generous.


Another Answer
An average U.S. household uses about 10,000 kilowatt-hours (kWh) of electricity each year. A watt is a unit of power, or energy per unit time, so it's the rate at which energy is being used. A kilowatt-hour (or 1000 watt-hours) is a unit of energy, so 10,000 kWh is how much total energy each household uses over the course of a year.

This means that each household, on average, uses energy at a rate of about 1 kilowatt (1000 watts, which equal to ten 100-watt light bulbs).

One megawatt is equal to one million watts, so for one instant, one megawatt can power 1000 homes.

A better question to ask is how many homes can a megawatt-hour (MWh) provide with energy for one hour? If one home needs 1 kWh of energy for one hour, then 1 MWh of energy can sustain 1000 homes for one hour.