The Thomson Dam Powerhouse is part of an unusual dam configuration where the power plant is located at a different site than the dam structure. In this case, the power plant is 3 miles from the dam. It is fed by a 2 mile long canal followed by a mile of underground pipes. At the bottom of the mile of pipes, we find two large surge towers. Surge towers smooth out the flow of water and prevents sudden changes in water pressure from reaching the hydro turbines. The water then enters the power plant building on its lower level, flows through the turbines, and then exits the power plant back into the Saint Louis River.

The power plant generates 70-megawatts of electricity. While this is far less than a typical 1000-megawatt nuclear reactor, it is also far larger than the 10-megawatt upper limit for small scale hydro projects. The Thomson plant is the largest hydro power project in the state of Minnesota. Its current owner, Minnesota Power, claims that it has the capacity to meet the electrical needs of the entire city of Duluth, the fourth largest city in the state with a population of 90,000. The generation of this electrical power without burning any fossil fuels, creating any greenhouse gases, or creating any waste products makes the Thomson Water Project a very good neighbor in a very sensitive tourist area.