The power room was a part of the TARDIS to which the Second Doctor once retreated immediately after using the emergency unit. Located just off the console room, it was key to fixing the TARDIS after the ship popped out of reality. Presumably, the power room had some part to play in the operation of the fluid links, since the fluid links' failure necessitated the use of the emergency unit.
Behind the scenes Edit
It's never revealed in the serial exactly what the power room does.