Thousands of shops and homes in Brighton were left without power after underground electricity cables caught fire.
Motorists at the busy Preston Circus junction in Brighton were forced to take their chances after the traffic lights failed, causing chaos on the roads.
The Duke of York's cinema cancelled an afternoon show and other businesses along London Road lost income when phones went down.
Electricity firm Seeboard said 3,000 households and firms were affected by the power cut yesterday, which lasted three-and-a-half hours.
Preston Circus fire station was able to switch to a standby generator but others were not so lucky.
Darren Jones, manager of the Mobile Phone Centre in London Road, said: "In this industry we can't do anything without electricity. Purely by chance, we found one phone line that allowed us outgoing calls only.
"But our customers were not able to get through. It has had quite an impact."
Suresh Patel, owner of the Spar shop in Clyde Road, said many people thought his shop had closed.
Standing in the dark, Mr Patel said his fridges had gone off, his phone had failed and he had to use a pocket calculator because his till was not working.
Dean Stewart, duty manager of the Duke of York's, said: "Our afternoon show was due to start at 1.30pm. Hopefully, we haven't lost too much business."
The London to Brighton Hog pub had a sign on the door reading: "We will be opening late due to a power cut. Sorry for any inconvenience."
The fault began at the corner of Shaftesbury Road and Clyde Road.
Resident Jason Teal, 30, said he saw flames coming from an electricity manhole at 10.30am.
He said: "I heard an explosion and thought a car was backfiring. The electricity flickered and then went off."
Seeboard spokesman Brian Phillips apologised to customers for the inconvenience.
He said: "Our engineers switched supplies by alternative routes to bypass the problem and customers were reconnected in stages."
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