A new energy market report backs the South Australian government's push for an interconnector with NSW, Energy Minister Dan van Holst Pellekaan says.
The Australian Energy Market Operator reports says consumers will be relying on coal-fired power for years to come as the market transitions to renewables.
"To support an orderly transition ... based on projected cost, the least-cost transition plan is to retain existing resources for as long as they can be economically relied on," it said in the report released on Tuesday.
Mr van Holst Pellekaan said the AEMO report also aligned with the SA government's plan to bring prices down.
"Our energy solution always included a range of components, interconnection being one of them, household batteries being another, grid-scale storage being another," he told reporters in Adelaide.
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"Certainly interconnection will deliver part of the overall savings."
The minister said the key element of a new interconnector was to put an end to SA being at the end of electricity line because of its sole connection with Victoria.
"We need interconnection with NSW to get us part of the loop and we also need to be connected to a state with much different weather patterns," he said.
"We need to be able to access electricity from NSW when we're short but more importantly be able to export our often over-abundant renewable energy."
Mr van Holst Pellekaan said the interconnector would be build through private investment but would be paid for over time by electricity consumers.
He said the cost to SA households was estimated at about $8 a year but there would be a net saving of about $30 a year through the access to cheaper power.
