The route for Melbourne's $16.5 billion 'missing road link' has been unveiled by the Victorian Government, with homes and businesses to be acquired to make way for the 26 kilometre project.

Key features of North East Link 26km road project with 5km tunnel at an estimated cost of $16.5 billion

26km road project with 5km tunnel at an estimated cost of $16.5 billion Begins at Springvale Rd, Nunawading, with a massive expansion of Eastern Freeway

Begins at Springvale Rd, Nunawading, with a massive expansion of Eastern Freeway Connects to six-lane tunnel at Bulleen Road

Connects to six-lane tunnel at Bulleen Road Includes connections to Lower Plenty Rd

Includes connections to Lower Plenty Rd Runs under Grimshaw St and connects to M80 Ring Road

The North East Link will be built between the Eastern Freeway and the Ring Road at Greensborough, through Bulleen and Banyule, under the plan confirmed by Premier Daniel Andrews on ABC Radio Melbourne.

The project will begin at Springvale Road in Nunawading with an expansion that will almost double the size of the freeway, creating up to seven extra lanes in some sections.

There will be some compulsory acquisitions, with 75 homes and 140 businesses affected.

The project will create 10,000 jobs, the Government said.

The link will include a 5km tunnel in a bid to minimise environmental and community impacts, Mr Andrews said.

The tunnel will begin at Bulleen Road and surface near Lower Plenty Road.

The budget for the road is $6 billion more than Mr Andrews estimated in August, a blowout the Government attributed to building a longer tunnel than first thought and widening the freeway.

The plan will make congestion worse at the city end of the freeway, the Opposition said. ( AAP: Julian Smith )

Known as route A, the plan was one of four shortlisted in August when the Government announced the road would go ahead after the next election.

The Premier said there had been modifications to those plans.

Mr Andrews said the route had been chosen after a number of consultations and studies.

"This is the strongest model,'' Mr Andrews said.

"This is about giving local roads back to residents, I wish this had been done 30 years ago."

The new section of road running north from the Eastern Freeway to Greensborough will be tolled.

But Mr Andrews said there would be no tolls on the expanded parts of the Eastern Freeway.

"Anyone who suggests that is playing silly games,'' he said.

Bureaucrats told Greensborough homeowner Ken Daly last night the house he built 45 years ago might need to be acquired.

"In the light of day it really sort of hits home," he said.

"If it doesn't happen I guess it doesn't matter, but if it does happen we're losing our home."

Mr Andrews said it would be difficult for people affected by the compulsory acquisitions.

"This will be very challenging and distressing for some residents. It will be very difficult for some residents to be receiving that news today," he said.

Shadow Treasurer Michael O'Brien said the cost of the road had risen dramatically.

"Six months ago Daniel Andrews said the North East Link would cost $7 billion. Then he said it would be $10 billion, then $13 billion and today he says it's going to cost $16.5 billion," he said.

"This is the biggest series of cost-blow outs in Victorian history, and all before a single shovel is in the ground."

The freeway will connect with a new six-lane tunnel at Bulleen Road and travel under the Yarra River and Banyule Flats.

The road will join up to the M80 Ring Road with connections at Lower Plenty Road and a new interchange at Grimshaw St.

Link expected to carry 100,000 cars a day

A business case for the road will be released next year and contracts will be only signed after the election, which is one year away.

Mr Andrews also told ABC Melbourne the State Government was prepared to sell its share of the Snowy Hydro scheme to the Federal Government.

The money could potentially be used to help fund the road link, but Mr Andrews said the State would not be told how to spend the windfall.

He ramped up the fight with the Turnbull Government over infrastructure, calling for a federal contribution to the project.

The Eastern Freeway will be upgraded between Springvale Road and Chandler Highway. ( ABC NEWS )

He said Victoria was only receiving 10 per cent of federal infrastructure cash, compared to nearly 50 per cent for New South Wales.

The North East Link has long been mooted, and was included in Sir Rod Eddington's 2008 future transport blueprint.

The Brumby government took a similar plan to the 2010 election but was defeated by Ted Baillieu's Coalition.

In August, the North East Link Authority said the road would carry 100,000 cars a day and complete Melbourne's orbital freeway system.

Studies have shown 20 per cent of Melbourne's freight traffic moves from the south-eastern suburbs to the north, and that this link would take trucks off local roads.

The Opposition supports a North East Link, but also plans to revive the dumped East West Link and build both at the same time.

It argued that without the East West Link, traffic from the North East Link will simply add to congestion at the city end of the Eastern Freeway and Alexander Parade.

The Government's route will run through Opposition Leader Matthew Guy's Bulleen electorate, as well as the marginal Labor seat of Ivanhoe, before ending in the safe ALP seat of Bundoora.