A $1 billion proposal to ease congestion along Wellington's coastal commuter belt has passed a crucial hurdle, with Transport Minister Annette King expected to announce that the Government is ready to move to the next stage of planning to reroute parts of State Highway 1 inland - a huge milestone in Transmission Gully's troubled history.

Transmission Gully was first mooted 50 years ago to solve congestion problems on State Highway 1's narrow and winding coastal route, but it took till 2006 for the region's transport planners and the Government to agree to investigate an inland route instead of upgrading and widening the coastal route, which faces stiff opposition.

The original Gully plan had the new highway starting from Linden at the southern end, then climbing the hills south of Porirua and crossing State Highway 58 east of the Pauatahanui bridge before rejoining State Highway 1 at McKays Crossing.

Planners have now come up with a new preferred route, costing $1.025 billion, but the biggest hurdle may be getting mayors to agree, the Dominion Post reports.

Wellington City Council, whose mayor Kerry Prendergast has been among the most vocal opponents, was overseas and unavailable for comment.

UnitedFuture leader Peter Dunne said the Gully was now "inevitable".

Otaki MP Darren Hughes described the announcement as "a breakthrough".

Porirua Mayor Jenny Brash said a regional fuel tax was inevitable but Transmission Gully was "crucial" for Wellington's economic future.

Lower Hutt Mayor David Ogden said the green light for the next stage of Transmission Gully was good news but there were other roading initiatives that needed attention.

Upper Hutt Mayor Wayne Guppy was dismayed, however, about being "kept in the dark" on the latest plans. "If we need to buy in ... I'd have thought we'd need to be informed."

Greater Wellington regional council chairwoman Fran Wilde said the Council was going to have to look at tolls and/or a petrol tax, but conceded that imposing a petrol tax  "would be a challenge" in today's climate of high fuel prices.

The Government has left the door open to the road being built by a public-private consortium, but says there are no plans for tolls.