Ok, realized I didn't explain the situation perfectly clearly. The existing service coming in can handle up to 320 amps. The existing breaker box says it's a 200 amp box. So hexus is probably right, we can get up to the 320 amps by adding a subpanel. To go higher, we've got to pay the utility ~$1000 (6-something per foot) to run the new wire and hook up the new meter. I googled and found an online load calculator, so we're going to run around the house and figure out what all our appliances need, and get educated on how that all figures into what we can really load onto our existing service. Our house, with the addition, is 4300 square feet. Does 320 feel sufficient for that square footage? (2 sets of A/C and furnaces, 3 1/2 baths, double laundry hookup) And the instant hot water heater (necessitated by the fact that the bath and laundry are on the far side of the house from the existing hot water heater, and we don't want to waste all the water needed to move hot water that distance) really does require 120 amps.

Have your electrician develop a proper load calculation. Note that with gas heat/hw/dryer your big draw will still be A/C. Once you have a load calc, you can compute what the drop will be given the size of your service conductors. I can't imagine that 30' is going to make a big deal but you'd have to check (and see what sort of voltage the POCO is currenly providing).

You need to be more specific with your tools and other uses in your house as well as your current service entrance size. My buddy's dust collector alone is 230v/30a and on startup would often dim lights until we upgraded his service entrance from 200a to 400a. Later we found out that his wife had a heat pad for something she did with paints that was also drawing near constant 20a/120v. Our house is 2200 sq ft. Even with my smaller dust collector (2.5hp Oneida) I could dim the lights with it and my bandsaw starting at the same time when we had 200a service. We got the power company to upgrade our line and meter to 400a but kept the 200a panel and our problems ceased. I found out that they (Xcel) now always provide a 400a service entrance even if the house is only calling for 200a. If your service entrance is barely large enough for 200a then you may have some issues, if it was sized larger then you'd likely be OK with smaller consumer tools.

I found this thread because I am looking at installing solar panels and an inverter, and found out that to grid tie, it is recommended to have a main panel rated for more than your actual service. I currently have an 200A service, but I want to upgrade my main panel to 400A to have a high enough rating on the bus bar. Then I would tie my solar in through an inverter to a breaker on the far end of the bus from the main. Eventually I want to own an electric car, and install enough solar panels to get a full daily charge, so as long as I'm doing a service upgrade, upgrading to 400A makes sense.