Several faults at gas and coal-powered electricity stations combined with massive energy demand brought NSW perilously close to blackouts during recent hot weather.
An Australian Energy Market Operator report released on Wednesday points to problems at several of the state's power stations during NSW's record-setting heat on February 10.
The report highlighted failures at the gas-powered Colongra and Tallawarra stations as well as reduced output at the coal-powered Liddell station.
There was also reduced wind and solar generation between 5pm and 6pm "in line with forecasts".
These factors during peak demand overloaded the NSW interconnections with Victoria and Queensland, "creating an insecure operating state", the report states.
The report also found forecast drop-offs in wind and solar contributed to the build-up of pressure on the network.
The massive electricity demand and underperformance at power stations pushed the AEMO to direct private energy provider TransGrid to reduce demand to the Tomago aluminium smelter.
This meant the smelter's three potlines were shut down sequentially for 75 minutes each during the afternoon of February 10.
Workers at the plant were forced to wear special suits and work in 80C heat in the smelter to save the plant's equipment.
The AEMO report found that all actions and responses of facilities and services were adequate.
However, the market operator said it would "consider further whether plant capabilities during extreme conditions are accurately reflected in bid and availability information".
NSW's operational demand peaked at 4.30pm on February 10 at 14,181 megawatts. The state's record peak demand was 14,744 MW on February 1, 2011.