'Boom! And then all hell broke loose': Dapto substation fire

Mr Brown owns Happy Ranch Horses on Yallah Road, with power lines on the property and the substation barely 50 metres away.

"I just had people riding around in a paddock," Mr Brown said.

"It just went 'boom!' then black smoke started coming out. Then it went 'boom!' a second time. Then fire started coming out. I rang the fire brigade and said there was a fire next door - then all hell broke loose, really."

On Saturday afternoon around three o'clock a redundant transformer at the Transgrid substation failed, causing about 100,000 litres of oil to catch alight.

The fire also caused a series of explosions, which is what Mr Brown heard.

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More than 60 firefighters were at the scene waiting for the power to be shut off so they could fight the fire.

Mr Brown said there were issues for the fire crews in finding the location of the substation.

"The fire engines pulled up here, they didn't know where to go," he said.

"I said 'don't come down here, I'll show you where it is' so I drove the ute down there."

Mr Brown said the fire was "no big deal" on Saturday as far as he was concerned.

"It looked more traumatic from the air but from here it didn't look anywhere near as potent as that," he said.

The police, however, took a more cautious approach.

They cordoned off both ends of Yallah Road, stopping anyone who wasn't a resident.

"The cops came round on a motorbike and said 'Get out! Get out!'. I said I can't just get out, I've got horses here tied up and saddled. He said, 'well, if that blows up you're dead'.

"So we undid the horses and let them all go in the bush and the next morning it was all over.'

Part of the ranch property includes a wooded area, where the horses head to at night. On Saturday night, they stayed there as usual. coming out on Sunday morning looking for food.

On Sunday, Mr Brown said the fire was out and everything was back to normal - they even had people turning up to ride the horses.

Transgrid owns the substation at Dapto and a spokeswoman said it continued to be "actively managed".

"The fire is smouldering and being monitored by HAZMAT services, emergency services and Transgrid personnel," a spokeswoman said on Monday.

"We are working closely with the authorities to keep them informed.

"We would like to re-affirm that this fire has not, and does not expect to cause any electricity supply issues.

"Transgrid will complete a formal investigation into the cause."

On Saturday, the Illawarra Shoalhaven Health District warned of "poor air quality" in the southern part of the region due to the fire on Saturday night.

However, as of Monday, the closest air quality meter at Kembla Grange stated that air quality was good.

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