I got to 120 spell penetration using the Cloudforger, Amulet Of Transference, Tome Holster, Geomancer's Bracers, Weed-walkers, Ring Of Pale Flame, and the Ring of Fortune or Guldring. Make sure you max out the strength attribute since that is the base stat used for spell penetration.
The calculation is (100/(100 + (warding - spell penetration)) with it stopping at 1 for the denominator. So if you have 50 spell penetration and the enemy has 0 warding then you do (100/50) or 2x as much damage. You have 90 more then you do (100/10) or 10x damage, and if you have 99 more than them then you do (100/1) or 100x as much damage.