Owners of horses in a community holding paddock near Lyons feared arcing power lines on Sunday morning would panic their animals and start a grass fire.
As temperatures began to climb to Canberra's hottest day in 11 months, three people with horses on agistment saw flames shooting into the air above the high-voltage lines.
Responding to a 000 call a fire brigade unit arrived soon after, followed by ActewAGL crews.
An Emergency Services Agency spokesman said the arcing had not ignited the grass.
About mid-morning Ruth Mauldon was putting her horse away when she heard a strange noise.
''I looked back and saw something dramatic, a tree was touching power lines and flames were burning into the sky about six to 10 feet.
''It was frightening. Two other agisters were coming down the road.
''We were running around like idiots, worried, scared.
''My horse was calm, but the other horses had all jumped and looked. They were in flight response. Some were careening around the place.''
In a statement ActewAGL said the tree, which was not entangled in the power line, was scalded but did not catch fire.
''The arcing may have looked like a spark or a small lightening strike that jumped out from the power line to the nearby tree.''
ActewAGL inspected the power lines during April and May when no indication of breaching the minimum clearance requirement was apparent.
About 30 horses are kept in the paddocks which skirt Lyons and Curtin at the foot of Oakey Hill, where high-voltage power lines are linked to a sub-station.
Angel Ben, another horse owner, said ActewAGL had trimmed the offending tree and another one close to the power lines after the alarm was raised.
''Given the 2003 fires that Canberra had, and given how many people died in the Black Saturday fires [in Victoria] where one was started from a tree touching a power line, I find it disgusting that ActewAGL, who has increased Canberrans' electricity prices and also issued notices to residents near power lines, is so neglectful in an area where there are numerous high-voltage power lines.
''In such hot, dry conditions where the grass in the paddocks is like fuel for a fire, all of Curtin and possibly Canberra could have been in flames from this act of neglect.''
Ms Ben said in the 2003 fires, three homes in a nearby cul-de-sac in Curtin, had burnt down, while a friend watched on helplessly when her horses had burnt to death.
''After a lot of rain and grass growth, all the horses are really fat.
''Once something starts, it will run up the hill in 10 seconds to burn the paddocks. The horses would try and jump barbed-wire fences and rip their chests to pieces.''