Delta Central Otago system control manager Graeme Johnson said about 20 houses were without power from just before midday to 4pm.
Queenstown company Jenkins Earthworks would be billed for the damage, Mr Johnson said, although he did not know the total cost.
The digger operator, who declined to be named, said it was his first time operating the machinery. He was "practising", picking up rubbish on an empty Lake Ave section when the digger's arm got caught in three power lines.
"I didn't know I was going to cause so much hassle. The police, ambulance, fire, electricians and now the media. I think I should retire," he said.
A neighbour on Lake Ave saw the lines had been snagged, ran out to alert the operator and called 111.
Jenkins Earthworks owner Warwick Jenkins said he accepted the incident was an accident.
Constable Hugh O'Reilly, of Queenstown Police, said the operator would not face charges.
