A £30m fund to encourage the purchase of low-carbon buses has been launched by the Department for Transport.

The fund is part of a wider government strategy to promote a shift to a low-carbon economy and improve air quality in the UK. It will allow bus operators and councils to apply for the government money which can then be put towards the initial cost of buying low-carbon buses.

Transport secretary, Andrew Adonis, said: ‘CO2 emissions from buses have increased significantly over the last 10 years. For the sake of our environment and the air quality in our towns and cities it’s important to encourage the industry to move towards low-carbon models.

‘I’m delighted that this is an industry where UK manufacturers are leading the field. Therefore, these companies and their employees are well placed to benefit from this initiative.’

Currently, low-carbon buses account for 0.2 per cent of the buses on the road today. The technology uses at least 30 per cent less fuel and emits a third less carbon than traditional buses.

Adonis added: ‘Over the next two years we expect this fund to support the purchase of several hundred low-carbon buses and, just as importantly, help to stimulate the development of a new green technology industry and help to safeguard up to 900 jobs in bus manufacturing.’