In 1888 Tamworth became the first town in Australia and the southern hemisphere to provide its residents with electric street lighting. The hotel was built on the old power station or ‘power house’ site, hence the name.
The power station operated for 67 years, closing in 1955 when it could no longer meet the demands of the growing city. It was demolished in 1983 and the new Powerhouse hotel opened on this site in December 1986. During the building phase of the hotel, efforts were made to retain as much as possible from the original site. The obelisk at the front of the hotel was erected to celebrate the history of Tamworth as the First City of Lights.