The power plant was built primarily to operate the sanding machines in the factory for production of timber, and is fourth in line in the watercourse 8 km downstream of Dalsfos. The factory burned down in 1952, and a new factory and power plant were developed.

The current power plant was commissioned in 2008 and was rebuilt outside the factory area in level with the dam. The new Kaplan turbine has a flow rate of 40 m³/sec. The dam was built before 1900, but has undergone many renovations. The most recent was in 2008, when the station was upgraded. The new power station has been moved and is now located just downstream of the dam in a separate building.

Borregaard NEA sold Vafos Power Plant to Skagerak Kraft in 2003, and it is now wholly owned by Skagerak Kraft AS.