The whole point of 'earthing up' potatoes is to promote as much growth of potatoes along the stem while also protecting the potatoes from being exposed to light. If the growing potatoes are exposed to sunlight, they will produce the toxin solanine and become inedible. You know that spuds have been exposed to light because they also turn green due to the production of chlorophyll.
I start earthing up my potatoes when the leafy bits are just under 12 inches tall, making sure I leave some of the leaves exposed to the sun so they can carry on photosynthesizing - so not completely covered. I then do it once again a week or two later (depending on how fast they're growing) essentially until I run out of soil. The potato mounds in my garden are about a foot high or so.
Another way to ensure your young potatoes aren't exposed to light is to use black plastic to cover the soil, although this method requires you actively water your plants as the rain can't get through. A benefit of using plastic is that you have to do very little digging to get to your potatoes. This year I used a combination of earthing up and putting a thin layer of newspaper and grass clippings over the soil. We'll see how that goes...