The blaze broke out around 9am on the 11th floor of a towering coal storage bunker and smouldered for most of the day, fuelled by highly flammable coal dust.

Yallourn's operators were forced to cut the power output of two of its four generators for much of the day, but they were restored to full power once the fire was contained by late afternoon.

A spokesman for the operators of the power station said an internal inquiry would be conducted to determine the exact cause of the blaze in the plant, which supplies about 20% of Victoria's electricity needs.