About 500 utility customers in south Palo Alto, including two area hotels, lost power for about three hours Wednesday morning after a contractor working in the area of Wilkie Way accidentally caused a circuit to break and a power line to drop, utility officials said.

The incident happened at about 9:15 a.m. and affected customers around El Camino Real, West Charleston Road, East Meadow Drive and Park Boulevard. The Crowne Plaza Cabana Hotel and Dinah's Garden Hotel, both on El Camino Real, experienced power outages.

The outage occurred one day before the Utilities Department was scheduled to replace old transformers, a project that will require the department to turn off electricity in this area. Many of the customers who lost power Wednesday morning had been notified to expect a power outage Thursday.

Utility officials restored power to all affected customers by 12:15 p.m.