The power plant is expected to provide up to 3,600MW -- the equivalent of three nuclear power plants -- when it is completed in a decade.
Regional officials remain committed to the Turkmenistan-Afghanistan-Pakistan-India (TAPI) pipeline despite Iran's numerous attempts to derail the project, either politically or violently.
It was the fourth outage in recent weeks caused by militant attacks, leaving Kabul residents frustrated and in the dark.
Officials from the participating nations -- Turkmenistan, Afghanistan, Pakistan and India -- have lauded the progress as a new step in co-operation.
The Iranian president's remarks about dam construction in Afghanistan sparked protests and outrage among Afghan citizens and government officials.