Ruahihi Canal was constructed in the late 1970s and early 1980s to lead water from Lake McLaren and the Wairoa River to the Ruahihi Power Station adjacent to SH29. The canal is about 2.5 km long, with water then being fed into penstocks for the final part of the journey to the power station. The penstocks are mainly underground, but the single penstock pipe can be followed from the end of the canal as far as Gunga Lane and Ruahihi Road. At some point the single pipe is split into the two which can be seen alongside SH29, across the road from the power station.
On most days the Wairoa River from McLaren Falls to the power station is only a trickle, but on some weekends the control gates are opened and the river returns to a normal level during the day. The river is popular for white water rafting.