As @Edric mentioned, powerlib
is built into SimPowerSystems. The error you see can thus have two causes
(1) There is no installation of SimPowerSystems in your copy of Matlab. Type ver
at the command prompt to check for what toolboxes you have installed. If SimPowerSystems doesn't show up in the list, you will have to get the toolbox, otherwise you won't be able to run the model.
(2) Your installation of SimPowerSystems is somehow corrupt. This has never happened to me in Matlab so far, but with modern technology, anything is possible. A fresh install should solve this.