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Alvøen is one of the oldest industrial places in Norway. As early as the 1620s a gunpowder mill was built here. The place itself was well situated for industrial activity, lying only 100 m from the waterfall, which provided power for the mill, and a good harbour wherefrom the products were shipped. The success of the gun-powder mill varied in the 1600s and 1700s, but what made Alvøen best known was its paper production.
Much rain, a steep drop and nearness to Bergen meant that the power-making potential of the Samnanger water system was exploited early. Samnanger was thus one of the first power-producing municipalities in western Norway. With its subsequent expansion and new power stations, about 400 gigawatts of electricity per hour were produced on average each year. This is enough to meet the energy needs of 25,000 households.