A fault in one of Rotorua's large underground cables caused the power outage that affected 400 customers last night.
Unison customer relations spokesman Danny Gough said while they had identified the cause of the outage, they do not know why it happened yet.
"One of the underground cables had a fault but at this stage we don't know what has caused that fault. It is quite rare for one of those cables to fault.
"We've been able to isolate where the fault has happened and will be digging down today to see if we can fix it, or need to take a piece of the cable away for analysis."
Mr Gough said all customers had their power restored by 11.40pm.
A Rotorua Lakes Council spokeswoman said last night about 400 customers were affected mainly around the central city, including the hospital and Eat Streat.
Lakes District Health Board communications officer Sue Wilkie said she was unaware of whether the hospital was directly affected by the outage.
"Usually when there is a power outage the back up generators kick in but there a signs of an outage - things like people not being able to log into computers. I haven't heard of anything like that happening last night."
Power has been cut to 400 customers in the central city, including Rotorua Hospital.
Unison was dealing with the problem and was trying to find the fault to underground cabling.
A Rotorua Lakes Council spokeswoman said Unison had informed them about 400 customers were affected mainly around the central city, including the hospital and Eat Streat.
Senior Sergeant Denton Grimes of the Rotorua police said there had been reports of power outages.
Street lights on Fenton St and Te Ngae Rd had been affected but the lights on Te Ngae Rd had since come back on, he said.
There had been no crashes in the district to cause the outages, he said.
Ponsonby Rd Lounge Bar owner Tamati Coffey said he was at home when he heard power had gone off down Eat Streat.
He said a similar thing had happened last year when a power transformer had failed.
He said he hoped the problem, whatever it was, was fixed soon.
Gas was still working at most of the restaurants.
A person posted on the Rotorua Daily Post Facebook page "Hubby sitting in a restaurant in Eat St with famz. It's pitch black. Thank gdness they can still drink. Don't think they will be eating."
Other people were commenting on the Facebook page they had experiencing flickering lights.