You're not increasing the reach, you're changing the balance of flash to ambient lighting.
Say you're inside and the exposure is ISO 400, 1/125 @ f/4. If you put that in as M on your camera, that exposure is correct. Now you put on your flash to add some pop as the light is dull. If you leave it on E-TTL mode and leave exposure compensation on 0, the flash will match the above exposure exactly. The flash will put out the same amount of light to try and match the scene ambient lighting.
If you put Flash EC up to +1 or +2, it will try and overpower the ambient lighting. The photo will look like a big bright flash photo and it may be overexposed since the flash is brighter than the natural scene.
If you turn the Flash EC down to -1 or -2, it will be underpowered, more like fill flash. It will be less noticeable as a flash photo with the ambient lighting doing most of the work and the flash just providing a little fill. This extends the life of your flash batteries and speeds up recycle as it does not use as much power.