It was mainly built to supply electricity to an aluminum factory located in Straumsvík, 3 km west of Hafnarfjörður.

For two years, the Norwegian engineer Gotfred Sætersmoen conducted a study on the development of hydroelectricity in the Þjórsá region.

[1] In the 2010s, the project has undergone an important extension, with the construction by Landsvirkjun of a second hydroelectric power station not far from the existing one.

[3] With an installed capacity of 100 MW, the plant was inaugurated on June 28, 2018, in the presence of Icelandic President Guðni Th.

Its altitude fluctuates between 241 and 247 m. From the Bjarnalón lake, the water reaches a 1,564 m long and 10 m diameter intake gallery.

After a 115 m drop in a pressurized penstock, it reaches the power plant where it drives 6 Francis turbines of 45 MW each.

The water, which comes from the same reservoir as for the historical power plant, flows through a 370 m long intake tunnel and then drops 110 m into the penstock.