The Welsh Assembly government provided £4.55 million for the New Tredegar Flood Alleviation Scheme, with an additional £550,000 from Caerphilly County Borough Council.
The defences, which were built by Environment Agency Wales, will reduce the risk of flooding to over 38 properties along the river Rhymney.
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Ms Davidson said: "It is likely that the impact of climate change will mean Wales will see increased flooding and we have to come to terms with this reality. We can’t stop flooding, but we can better prepare and improve the way we manage it.
"Building flood defences such as these at Tredegar is one of the ways of alleviating the impact on our communities. However it may not always be possible to do this in the future."
New Tredegar has a long history of small floods and experienced significant flooding in 1998 and 2000 when a number of properties along the river Rhymney were damaged. These include homes, a sports centre, a primary school and the Glan yr Afon residential home.
(CD/KMcA)
