The use of underground transmission cables has continuously increased in densely inhabited urban and suburban area. Due to a increasing demand of underground cables, two or more circuits are installed in parallel for several kilometers. It, however, has not been realized that the sheath circulating current is generated in the system where a large number of cables are laid in the same route. In this paper, sheath circulating current is analyzed by the EMTP and compared with the measured values. Unbalance arrangement of cables or cross-bonding length causes a significant effect on the magnitude of the sheath current. Sheath circulating current could be greatly reduced by the symmetrical configuration of cables and installation of the impedance reduction system. Especially, with the impedance system of 1Ω installed, the sheath circulating current is reduced by 85.7%.