What is the strange event in this simulation of a galactic collision? I was watching this video on YouTube: 2 Spiral Galaxies w/Supermassive Black Holes Collide
Around half way, and again almost at the end, the black holes seem to suddenly give off some sort of force which blasts away a lot of the matter around them. What is this effect known as or caused by?
 A: Also, in addition to all of this said above, galaxies are full of dust.  When they collide, they will dump a bunch of dust onto all of the stars in the other galaxy.  This then accelerates the rate of fusion in the stars--this means that you will get a bunch of time-correlated supernovae, which will then eject out a bunch of hot gas.  Several of these happening at once can form a shockwave.  Since it is the very last thing that happens, I assume that this is what your'e seeing.  
A: I don't know if that video is pointing to a faithful simulation or not, but orbiting and merging black holes give off massive amounts of gravitational waves (theoretically) which I guess could cause matter to move like that, especially at the merging moment.
See this other simulation from NASA which discusses simulating black hole merging and the corresponding YouTube video where you can see the ejection of gravitational waves (note that the video you linked visualizes matter, not the gravitational waves, although the latter will of course perturb the former).
A: Material (like gas) in disorganized orbits around any massive body (or even just a common center of gravity) can collapse inward over time (the mechanism is collisions between the bits). 
This results in heating the material. Look up "Virial Heating".
Because of the small size and large local field of black holes gases trapped near them can heat up a lot, and there is the possibility of jets as well.
Large gas clouds from one galaxy could introduce a lot of new matter to the vicinity of the central black hole in the other resulting in a period of intense radiation.
