The 900-kilometre line will cost about $2.3 billion with ElectraNet to provide $457 million for work in SA.

TransGrid previously committed $1.8 billion for work in NSW.

The interconnector is forecast to cut power bills in SA by about $100 a year for the average household.

Before Monday's final commitment, the Australian Energy Regulator had approved the expenditure required for the project.

Work is now expected to start later this year with commissioning of the line slated for 2023.

"Project EnergyConnect will drive competition in the wholesale electricity market by connecting more, low-cost generation to the national electricity grid and support the ongoing transition to a lower carbon emissions future," ElectraNet Chief Executive Steve Masters said.

"ElectraNet has left no stone unturned to ensure that this project is a good investment for electricity customers in South Australia and New South Wales.

"We undertook a rigorous cost-benefit analysis that has been repeatedly updated to demonstrate this remains the best option for customers as well as supporting the rapid pace of change across the National Energy Market.

The new line will run from Robertstown, in SA's mid-north, through Buronga to Wagga Wagga with the Robertstown sub-station to upgraded and a new one built at Bundey.

Another transmission line will be built between Buronga and Red Cliffs in Victoria.

SA Energy Minister Dan van Holst Pellekan said the interconnector would unlock the development of new renewable energy projects along the route.

"EnergyConnect will be a freeway for green energy produced in South Australia and exported to New South Wales," he said.

"South Australia is a good global citizen and will become a net exporter of renewable energy as part of our aspiration of net-100 per cent renewables in the 2030s."

Australian Associated Press