An Essential Energy spokeswoman confirmed that the balloon was the cause of a major outage for the town affecting 1427 customers in Merimbula on Monday afternoon.

"Network protection equipment activated at 2.22pm after detecting a fault on the high voltage powerlines. Attending crews discovered the cause of the power outage was a balloon coming into contact with the overhead powerlines on the corner of Collins and Henwood Street, Merimbula," the spokeswoman said.

The confirmation promoted Karen Joynes, the spokeswoman of 'No Balloon Release Australia' to call for more regulation around balloon release and helium.

"The power outage at Merimbula is an extra reason to ban the release of balloons and regulate the sale of helium so it is not used to inflate balloons," Ms Joynes said.

"No Balloon Release Australia has been campaigning for action on released helium balloons because they have the potential to cause death and injury to wildlife, and because they result in litter. The power outage shows there are other valid reasons to ban the release of balloons, and we need to prevent people from accessing helium used to inflate balloons to stop releases at the source," Ms Joynes added.

"Helium has far more important uses than the frivolous disappearance of a balloon into the sky - or onto power lines, as in this case."

Essential Energy said that crews isolated the damaged powerline, re-routed power around the network and began back-feeding to progressively restore supply to customers from 3.40pm. Over 1000 customers had their power restored by 3.42pm, while the remaining customers were restored by 4.38pm.

There was also another outage on Monday when at 2.33pm Fire and Rescue NSW were called to the old Woolworths building where a spokesman said "a smoking substation had been spotted".

"We evacuated five people from a work site and the energy authority took over," the spokesman said.

Essential Energy crews isolated a damaged underground padmount substation and continued repairs on Tuesday. Essential Energy is currently investigating the incident further.

There are two petitions supporting No Balloon Release Australia's campaign with the Boomerang Alliance and Australian Marine Conservation Society.

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