Finance Secretary John Swinney told MSPs the blackout had been due to a faulty electronic relay near Inverness.
He said the relay at Knocknagael, a recently redeveloped substation at Essich, near Inverness, had “malfunctioned”.
This fault caused circuit breakers to open, shutting off the power but also preventing “more protracted and significant damage” to the system supplying the north and north west of Scotland.
The problem was deemed so severe First Minister Alex Salmond chaired a meeting of the Scottish Government Resilience Committee, which is activated in the event of widespread or complex emergencies.
Mr Swinney said electricity supplies to most of the affected properties were restored by Thursday morning, but it had taken longer to return power to homes in Orkney.
The minister was answering a question from SNP MSP Rob Gibson on the cause of last week’s power cut.
Scottish and Southern Energy (SSE) Power Distribution, who initially thought the outage was caused by a foreign object striking a line, used a helicopter to inspect 55 miles (88.5km) of power lines between Moray and Inverness in an effort to identify the problem.
The power cut led to a number of distressed residents calling Fire Scotland for help, and fire crews were also sent to deal with a number of alarms set off by the power outage.
Some rail services were disrupted with ScotRail reporting delays of up to 20 minutes due to a power supply problem at Inverness.