The other day I was drilling a hole in a wall to run a 3-prong extension cord through. I thought a 1 inch spade bit would do to create 1 inch diameter hole. Unfortunately, the plug end of the cord was still too big to fit through the hole. I couldn’t enlarge the hole using a hole saw bit
because that requires some material for the center shaft to bite in to.
To get around this, you can place a thin piece of plywood over the hole and use a hole saw to drill through it.
Another option is to use a regular drill bit in reverse will pressing the bit against the inside wall of the hole to eat away some of the material. The resulting hole will not be a perfect and clean hole but that may not matter, depending on your needs. The drill needs to go in reverse in order for this to work.
A better option than the previous one, if you have this type of bit available, is to use a router mill bit.
Router bits are designed differently than regular bits because their purpose is to mill away material using their sides. I ended up using this approach and was able to easily enlarge that 1 inch hole to fit a plug through.