The Department of Conservation at Wakatipu gave Invercargill electrician Chris Traynor permission to restore the 80-year-old generator.
The 400kg water-driven machine was flown by helicopter to Skippers in May. Doc rangers reinstalled the equipment in the corrugated iron shed which housed the generator.
The generator house will be restored by the department next summer and an interpretation panel installed.
The old equipment can be found by walking 30 minutes from the historic Skippers township along the old road to Skippers Creek.
Doc Wakatipu works officer Richard Struthers said the equipment was an excellent example of early electrical heritage.
Doc's preference was to maintain and preserve historical items on site, rather than putting them in a museum. The generator was also more remarkable when viewed in its original location, he said.
''It's a further stage in managing the historic Skippers site, which was significant in the settlement of Otago.
''It wasn't the original generator at the site, but was the same as the machinery that drove the Sandhills Dredge which operated in a tributary of the upper Shotover River in the 1890s.
''This was the world's first dredge to be powered by hydro-electricity.''
Mr Traynor said it took a few months of work by him and his workmates to repair and restore the generator and switchboard.
He decided to tackle the job because he had spent a lot of time in Skippers since he was a child and wanted to give something back to the area.
