In the 1820s, the demand of coal continued to rise, along with a companion need for better transportation of the coal. The Union Canal was constructed to connect the Schuylkill and Susquehanna rivers.

Soon the Union Canal Company built a branch canal called the Swatara Feeder. When completed, its length was about 22 miles along Swatara Creek. There were 14 lift locks, one guard lock, six aqueducts and four large dams.The first boat trip from Pine Grove to Philadelphia via the Union Canal took place in 1830 - the trip took five days. By comparison, a stagecoach run between Pottsville and Philadelphia during that year would have taken about 18 hours. By 1842, 500,000 tons of coal were shipped from Schuylkill County by canal or rail.A flood in 1862 destroyed the majority of infrastructure of the Union Canal, although seven locks and three dams still exist in nearby Swatara State Park. The dam at what's now Sweet Arrow Lake was flattened.It wasn't until the 1920s that a new dam was built there to support an electric generation plant operated first by East Penn Electric Company and later by Pennsylvania Power and Light. In 1972 the borough of Pine Grove purchased the property (183 acres which includes 60 acres of water, spanning Washington and Pine Grove townships).Unable to afford repairs, Pine Grove sold the property to Schuylkill County in 2001.