EnergyAustralia says if necessary it will cut power to thousands of households in South Strathfield, Belfield and Enfield on Friday afternoon to cope with high demand while a substation fault is being repaired.
The Bureau of Meteorology (BOM) has forecast temperatures in the mid to high 30s on Friday.
An EnergyAustralia spokesman says the company hopes not to cut off power until about 3pm (AEDT) and only if demand rises beyond manageable levels.
Two major cables supplying the Enfield Zone Substation were still under emergency repair, he told AAP.
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Power will be cut off in a controlled manner, affecting between 1000 and 1500 homes at any one time.
But no household is expected to be without power for more than two hours.
The substation fault cut power to about 12,000 homes and businesses in the city's inner west from 8.40am (AEDT) on Wednesday and about 2600 homes were left without power for some time on Thursday.
Compensation of $100 is available for customers left without power for more than six hours, and those left without power for more than 12 hours are eligible for a further $80.
Customers can also claim money back for food spoilage caused by the lack of power.
EnergyAustralia had received about 1000 inquiries by Friday from customers looking for compensation, the spokesman said.
The weather bureau expects the heatwave to last until Sunday, when a southerly change is expected to bring cooler temperatures.
