Coventry and Oxford could be awarded up to £50 million each to switch their entire bus fleets to electric by 2025.
The funding, subject to successful business cases, will also see the cities install new charging infrastructure and pay for electric grid updates.
The Government received 19 bids from across England for its all-electric bus towns and cities competition, which aims to help improve air quality and reduce emissions, helping further deliver on the government’s efforts to decarbonise the transport network, as well as support local businesses and jobs in the UK developing green buses.
Up to 500 buses could be replaced – saving thousands of tonnes of CO2 each year, the Government said.
Transport Secretary Grant Shapps said: “As we build back greener from Covid-19, we can provide people with more environmentally-friendly transport and cleaner air.
“Coventry and Oxford could soon be at the forefront of our plans for a new era of bus services, helping us develop the green transport network of the future and support jobs right here in the UK.”
Andy Street, the Mayor of the West Midlands described the move to electric as a “major boost to public transport in the city”, adding that it would “help tackle the climate emergency we face both here in the West Midlands and the wider UK”.
Oxfordshire County Council Leader, Councillor Ian Hudspeth, said: “Oxfordshire’s bid comes at a time when our council is determined to take concerted climate action to cut vehicle air pollution and expand the provision of bus services with our Zero Emission Zone and Connecting Oxford plans.
“This council is committed to offering our residents a clean and environmentally sustainable future through a series of steps including through better public transport.”
The all-electric bus towns and cities competition is part of a wider package of measures to improve services and make bus journeys greener, easier and more reliable.
In February 2020 the Government announced £5 billion for a new golden era for buses and active travel.
The UK’s first-ever long-term bus strategy will be launched in the coming months to ensure buses are prioritised into the future.