Repeatedly zaps enemies that are in close proximity to Isaac with electricity beams for light damage.
Enemies can be zapped up to five times per second, with each zap dealing 0.75× Isaac's damage.
Each zap can hit up to 4 enemies, if they are sufficiently close to each other.
If the floor is wet, such as in Downpour, Flooded Caves, some rooms in Dross, Scarred Womb, and Corpse, as well as under the effect of Flush!, the initial distance is unchanged, but enemy-to-enemy arcs reach further.
Trigger range appears to be approximately two tiles wide — it's possible to zap an enemy standing directly on the other side of a rock.
Notes
This item has a brief targeting delay, such that enemies can close in and touch Isaac before they start getting zapped.
Synergies
Multiple battery-themed items have special synergies with the zaps:
Sharp Plug / Car Battery: Electricity deals 100% of Isaac's tear damage if he owns 1 of these items, and 150% if Isaac owns both.
Old Capacitor: Allows zaps to arc on the same enemy multiple times.
Abyss: When Isaac uses Abyss to absorb 120 Volt, it turns into a pale blue locust. The locust can create arcs of electricity dealing 0.1 damage per tick.
Camo Undies: Enemies won't target Isaac, thus he can safely zap enemies while standing near them. However, this won't work with bosses.
Isaac's Heart: 120 Volt becomes much safer to use offensively as Isaac's body no longer takes damage.
Items granting invulnerability or a shield: 120 Volt zaps enemies while Isaac is invincible.
This includes Gnawed Leaf, allowing Isaac to clear most rooms without moving.
Dark Arts: Enemies and bosses will be zapped while Dark Arts' effect is active, allowing Isaac to safely deal damage while invulnerable in this way.
Pause: Zaps will not stop the pause effect allowing Isaac to kill or chip bosses easily by standing near them for the duration of the pause effect.
This item originated in the Antibirth mod. It originally had an effect similar to Jacob's Ladder and a different costume.
The Antibirth item was very similar to the item "Box of Wires" from the Community Remix mod for the original Flash version of Isaac.
120 volt is the voltage of standard household circuit in the US.
In the Chinese translation of the Binding of Isaac: Repentance, it's changed to “220伏 (220 Volt)”, referencing the standard household circuit voltage in mainland China.
Downpour, 
Flooded Caves, some rooms in 
Dross, 
Scarred Womb, and 
Corpse, as well as under the effect of 
Flush!, the initial distance is unchanged, but enemy-to-enemy arcs reach further.
Sharp Plug / 
Car Battery: Electricity deals 100% of Isaac's tear damage if he owns 1 of these items, and 150% if Isaac owns both.
The Battery / 
Jumper Cables / 
AAA Battery: Increases amount of arcs a zap can generate.
Old Capacitor: Allows zaps to arc on the same enemy multiple times.
Abyss: When Isaac uses Abyss to absorb 120 Volt, it turns into a pale blue locust. The locust can create arcs of electricity dealing 0.1 damage per tick.
Camo Undies: Enemies won't target Isaac, thus he can safely zap enemies while standing near them. However, this won't work with bosses.
Isaac's Heart: 120 Volt becomes much safer to use offensively as Isaac's body no longer takes damage.
Gnawed Leaf, allowing Isaac to clear most rooms without moving.
Dark Arts: Enemies and bosses will be zapped while Dark Arts' effect is active, allowing Isaac to safely deal damage while invulnerable in this way.
Pause: Zaps will not stop the pause effect allowing Isaac to kill or chip bosses easily by standing near them for the duration of the pause effect.
Tainted Forgotten: Tainted Forgotten zaps enemies, allowing 
Tainted Soul to damage enemies from a safe distance.
Mine Crafter: The TNT is spawned and then instantly detonated by 120 Volt's electric shock, inflicting 1 full heart of damage.
Jacob's Ladder and a different costume.
The Binding of Isaac: Rebirth
